Curve's token CRV surged to a price of over $1.10 amid rising demand for decentralized stablecoins. The rising demand is stemming from likely regulatory action being taken against Paxos by the SEC concerning their issuance of stablecoin Binance USD.
Although Curve does not currently offer native stablecoins, it plans to launch crvUSD, a dollar-pegged asset that will allow stablecoin pools to supply pricing data to external protocols. They recently teased the release of the stablecoin in a tweet on Monday.
Curve's reliance on smart contracts instead of middlemen for financial services make it distinct from centralized and fiat-backed stablecoins. Decentralized stablecoins seem to be gaining positive sentiment in the crypto market, as centralized stablecoins face bearish sentiment due to legal investigations.
Decentralized stablecoins use a basket of cryptocurrencies to back their peg to a fiat currency and typically employ an algorithm to ensure that the value maintains it’s pegSignificant challenges do exist regarding the implementation of autonomous and algorithmic stablecoins. The collapse of TerraUSD is still looming over the industry.