Regarding this tweet, how is it possible ? By going up

Question

Regarding this tweet, how is it possible ? By going up

in price, given sufficient time, being an lp should net you more crvusd and less susde and thus experiencing IL ? No ?

https://x.com/curvefinance/status/1816761033987412042?s=46

#curve #de-fi #english

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26.07.2024

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Michael

No

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1 месяц назад

Genlo Автор вопроса

fiddyresearch
Well that only happens if the amm doesn’t know the...

Thanks, it does indeed ! At least on the base theorie level 😂

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1 месяц назад

fiddyresearch · Accepted Answer

Well that only happens if the amm doesn’t know the redemption rate. It would keep giving you 1:1 crvusd > susde and that’s definitely not good. Stableswap amms are redemption rate aware, and the exchange rate is governed by amm logic + external rate oracle. The upside is you get these kinda of yield bearing tokens in the pool. The other upside is curve, unlike other amm providers, never skims yield off the top and call it revenue. The downside is curve doesn’t control these external rate oracles, which may be governed by an eoa or a multisig and has considerable control on exchange rates. If you read the smart contract, there is a disclaimer for this risk at the top. Does this explanation help?

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Regarding this tweet, how is it possible ? By going up

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