Tron Founder Justin Sun Pledges Support to DeFi Project Curve Finance Amidst Ongoing Attacks

Justin Sun, the founder of Tron blockchain, has announced his commitment to support Curve Finance, a DeFi project that has been under attack for the past 48 hours. Taking to Twitter on August 1, Justin Sun declared that Tron would act as a steadfast partner to Curve Finance, offering support whenever needed to tackle the challenges the project is facing. The collaboration aims to empower the DeFi community and strengthen the concept of decentralized finance.

One of the initiatives in this partnership will involve the introduction of an stUSDT pool on Curve Finance. stUSDT is a stablecoin known for being backed by real-world assets, boasting a market capitalization of 400 million USD. This move is expected to enhance user benefits and provide stability to the DeFi platform.

Apart from extending support to Curve Finance, Justin Sun has recently engaged in a significant purchase of CRV tokens through an over-the-counter (OTC) transaction. PeckShield, a security firm, reported that a wallet address linked to Justin Sun had acquired 5 million CRV tokens, worth approximately 2.9 million USD, from Michael Egorov, the founder of Curve Finance. On-chain data suggests that the tokens were purchased at a price lower than the prevailing market rate, specifically at 0.4 USD per CRV token.

However, these actions have sparked controversy as the CRV token’s value has been declining over the past few days due to persistent attacks on the Curve Finance platform, resulting in losses of tens of millions of USD. This downward trend raises concerns for Michael Egorov, as his substantial holdings of CRV tokens are pledged as collateral for loans on various platforms.

On Aave, Egorov has utilized approximately 305 million USD worth of CRV tokens as collateral for a loan of 63.2 million USD. At a liquidation threshold of 55%, his position will face the risk of liquidation if the CRV token’s value drops to 0.3767 USDT. Similarly, on the Frax Finance protocol, Egorov has borrowed 15.8 million USD worth of FRAX, using CRV tokens worth 59 million USD as collateral.

In the past 24 hours, Egorov has made efforts to reduce risk by paying off 4 million FRAX, but the situation remains precarious. With a maximum loan-to-value (LTV) ratio of 75%, the liquidation threshold for Egorov’s position is projected to reach 0.517 CRV/FRAX within the next 4.5 days, representing a marginal decrease of less than 10% from the current price.

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