Curve Founder: The Next Massive Expansion Is Coming (New Thesis)

**Robbie** (0:00)
We are back with our weekly Stablecoins segment, presented by Frax. Today, we've got Michael Egorov of Curve. He's been building in the space for a number of years. Curve was one of the OG pioneers of the Stablecoin space. It's an absolute pleasure to have you on the show today, Michael. I'm excited because Stablecoins feels like one of the few industries where we have a super cycle going on. Talking about tokenization, talking about prediction markets, talking about perps, but it feels like the industry itself is kind of underpinned by Stablecoins. You're a leader in Stablecoin infrastructure. Curve has been around underpinning Stablecoins for a long, long time. You're also very, very technical, so I'm excited to get into some of the depths here.
You've got YieldBasis as well, which is a little bit of a newer project. But today, I think we're to focus a little bit more on Curve. And so, you've spent six years plus developing liquidity infrastructure for Stablecoins through Curve. We were very in the weeds when Curve was originally getting built. It was among the DeFi Legos, and it was specifically for Stablecoins. Maybe you could talk us through some of the more recent advancements in Stablecoins and Curve. I also want to get your opinion on the open US dollar, that consortium Stablecoin that we heard.
Obviously Circle and Tether have been kind of the leaders in the space. Curve obviously as well in the space, more on the liquidity infrastructure side. Maybe you could just give us a little bit of a primer on your take on Stablecoins, where are we at today, and I want to get your take on open US dollar.

**Michael Egorov** (1:44)
Right, right. Yeah, so today is somewhat different from what it was in OG times. In OG times, we had a lot of experimentation, happening with fully decentralized Stablecoins, or maybe not so decentralized, but I would say in some ways, in some ways algorithmic, right? Like even collateral debt position is algorithmic. And it undeniably works. There are quite a few today, but yeah, so some Stablecoins are like that, and some Stablecoins are redeemable, powered by deposits somewhere. So Tether, USDC, and newer Stablecoins, like PiUSD, USDG, and whatever, right?
And I think most recently, we have mostly a lot of push with redeemable Stablecoins, because many players started realizing it's probably, probably something good to participate in, but at the same time, it's not easy, because there are existing players, like Tether and Circle, you mentioned.

**Robbie** (3:03)
Absolutely. Tether and Circle, redeemable Stablecoins. Algorithmic Stablecoins were sort of like, you know, the big thing. We obviously saw what happened to Tera, you know, USDT, excuse me, Tera, USD, and, you know, this had some fundamental, you know, mechanism design flaws as a part of it.

**Michael Egorov** (3:22)
Yeah, not only that, yes.

**Robbie** (3:25)
Yeah, absolutely. There was plenty of shenanigans happening with Tera. So as we're thinking through, like, the mechanism design for stablecoin infrastructure, as we prepare for institutional liquidity come on chain, I think that is what we're seeing play out. We're seeing the likes of JP Morgan, banks, financial institutions. Everyone is thinking through tokenization, and stablecoins are a very fundamental part of tokenization.
Can you give us maybe an update on how Curve is tackling stablecoins in this more maybe modern stablecoin era?

**Michael Egorov** (4:01)
Yeah, well, originally what Curve was designed for is to swap between stablecoins of the same denomination. That was what it started with, right? And it was, well, the need was clear. There was stablecoin like DAI, for example, which is decentralized, and you would want to exchange it to USDC or USDT to essentially withdraw to your bank account or whatever.
Or, you know, doing the reverse as well, right? Today, it's more like exchanging between redeemable stablecoins, but, you know, with the same algorithm it works.
And basically, this infrastructure plays a role of some sort of bridge connecting different stablecoins. Maybe some stablecoin redeems better in the US, maybe some stablecoin better redeems in Europe or in Asia, or maybe, I don't know, maybe there is something special in New York, like BitLicense, and you need another stablecoin. And the curve essentially underpinned liquidity between all those kinds of stablecoins all the time. But, you know, that's a part of curve, right? We have multiple things going on, but this is probably the earliest, like something curve started with, and it's probably still the biggest part. Yeah.

**Robbie** (5:43)
Okay. And now another part of the stablecoin world that has been sort of the subject of mixed opinions. I've heard people say that, you know, we're going to get non-US dollar denominated stablecoins, it's going to overpower the US dollars, you know, portion of the market. And then others say, you know, there really is no reason for non-US dollar stablecoins to exist in the FX market, you know, is essentially dominated by the US dollar.