Pangea dives into Curve's crvUSD Monetary Policy, explaining what it is, how and why it's changing, and what this means for users and the system as a whole.

TL;DR: crvUSD is a CDP stablecoin that stays stable using PegKeepers and dynamic interest rates. But large new credit lines (YieldBasis, ResupplyFi) created peg pressure, making borrow rates very volatile. Two proposals aim to fix this: LlamaRisk wants to raise the Target Fraction and lower the Target Rate to reduce PK-driven volatility, while Egorov proposes smoothing rate calculations with a 3-week EMA. Together, these changes should stabilize borrow rates, encourage more crvUSD minting, and keep the system reliable as it scales toward a $1B credit line.

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More coverage

• Inside crvUSD Borrow Rate - Curve News (news.curve.finance)
• Curve Stablecoin - Deep dive - Statemind (statemind.io)
• Pangea (Page 2) (blog.pangea.foundation)
• Increase credit line for Yield Basis to 1B crvUSD - Proposals (gov.curve.finance)
• Pangea (blog.pangea.foundation)

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