Understanding Michael Egorov's Aave Positions
Recent on-chain data reveals that Curve founder Michael Egorov deposited 38 million CRV ($24.5M) into Aave to mitigate liquidation risks amid CRV's price decline. Here's a breakdown of his current collateralization strategy:
Total Borrowings Across Aave Platforms
| Platform | CRV Deposited | Value (USD) | Stablecoins Borrowed |
|---|---|---|---|
| Aave V2 | 277M CRV | $178M | 64.23M USDT |
| Aave V3 | 14.1M CRV | $9.09M | 2.78M USDT + 743K USDC |
| Total | 291M CRV | $187M | $67.75M |
Health Factor: 1.68 (Aave V2)
Fund Utilization Analysis
The borrowed stablecoins were allocated to:
- Bitfinex Deposits: $37.7M USDT (including $31M during April 10-14 BTC rally)
- Wintermute Trading: $51M USDC transfers since May 2023
Strategic Purchases:
- 4,014 ETH ($1,694/ETH) during USDC depegging
- 7.8M USDC bought at $0.95 (profitable trade)
Market Implications of CRV Collateralization
Circulating Supply Impact
- 291M CRV collateralized = 34.15% of circulating supply (852M CRV)
- Creates a potential "debt snowball" risk if CRV prices approach liquidation thresholds
Key Risks Identified
- Aave protocol exposure ($160M bad debt from November 2022 CRV short squeeze)
- Possible coordinated attacks targeting liquidation price
- Market perception challenges regarding founder's financial moves
FAQ: Addressing Key Concerns
Q: Is this a "hold" strategy or disguised selling?
A: While avoiding direct market sells suggests retention, the massive collateral position creates latent selling pressure via potential liquidations.
Q: What triggers would cause cascade liquidations?
A: If CRV falls below health factor thresholds, automated liquidations could flood the market with CRV supply.
Q: How does this affect Curve's ecosystem stability?
A: Prolonged uncertainty may deter new liquidity providers and destabilize CRV's valuation.
👉 Explore decentralized finance strategies for risk-managed exposure to collateralized assets.
Recent Controversies Surrounding Egorov
- $41M Melbourne real estate purchases (May 2023)
- VC lawsuits alleging mishandled $1M Curve investments (June 2023)
Market observers note these developments compound existing concerns about centralized control of DeFi protocols.