Curve Yield Farmers Rush to Stake $60M on Newly Launched Conic Finance, Earning 21% APY on USD Coins

A new earnings-tracking tool by popular stablecoin exchange Curve has attracted over $60 million from depositors a little over a week after it was launched.

Conic Finance, which went live on March 1st, allows users to deposit tokens into its Omnipools, a new product that will diversify exposure across the Curve ecosystem while increasing rewards.

Each omnipool allocates the liquidity of a single asset to different curve pools. All Curve Liquidity Provider (LP) tokens will be set to Convex to boost Curve (CRV) rewards. Convex (CNX), another Curve ecosystem token, will also be rewarded, as will Conic (CNC), Conic’s native token.

Conic users can earn up to 21% annualized returns on the three omnipools for Dai (DAI), Frax (FRAX) and USD-Coin (USDC). The USDC pool alone has attracted over $50 million in liquidity as Conic currently offers one of the highest available yields in the crypto market for USDC. Frax and Dai’s deposits are significantly lower at $7 million and $5 million, respectively.

Holders can lock their CNC tokens for vlCNC to participate in Conic governance and directly control how liquidity curve pools are allocated by voting in Conic’s Liquidity Allocation Votes (LAV) – which determine the proportion of an omnipool’s liquidity , which a curve pool can obtain.

In the coming weeks, Conic’s demand among traders for its revenue-generating products could ultimately generate value for its own CNC token.

As such, CNC tokens are currently trading at $8 and are down 4% in the last 24 hours with a market cap of $32 million.

According to developer documents, Curve leverages smart contracts to provide an efficient way to exchange stablecoins while maintaining low fees and slippage. Depositors on Curve earn annual returns of up to 4% from one of the many pools on the platform, which locks over $5 billion worth of Ethereum-based tokens on its platform.

Curve tokens (CRV) are issued as yield farming rewards to liquidity providers on Curve Finance and can be converted into proxy voting CRV (veCRV). Holding veCRV allows users to participate in platform governance, earn higher rewards and fees, and receive airdrops.

The tokens are time-locked, which means users are encouraged to lock their CRV for a long time to get more veCRV and platform rewards. However, this mechanism effectively ties up liquidity and incurs an opportunity cost for users.

This is where protocols like Conic come in, allowing users to access or provide liquidity to the Curve ecosystem to be rewarded without having to lock their tokens for long periods by depositing directly to Curve .

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