Curve Finance, a decentralized finance (DeFi) protocol, has launched its algorithmic stablecoin, crvUSD, with the token experiencing a 0.25% price increase in the last 24 hours. In the last few hours, a contract deployed by Curve Finance on the Ethereum mainnet produced over $22 million worth of crvUSD, with $20 million minted in just five minutes. After issuing the first tokens, a wallet labeled “Curve.Fi Team” leveraged around $1.8 million in frxETH to create a $1 million crvUSD loan, which Curve later confirmed. The smart contracts for crvUSD are deployed, but the front end is still pending. Once fully deployed, the stablecoin will face stiff competition from other DeFi protocols that have also issued their own native stablecoins to boost declining crypto trading and lending activity.

Following the successful deployment of its smart contracts, crvUSD reportedly gained 7.16% in the past 24 hours, with the price increasing from $0.96 to $1.03. CoinGecko data shows that the price dropped to $1.01 before rising to $1.02, where it remained until the time of writing. While some investors may be wary of algorithmic stablecoins following the collapse of Do Kwon’s Terra USD (UST), Curve Finance claims that its new offering is distinct from UST in that it employs a design similar to MakerDAO’s DAI stablecoin.

Curve Finance states that crvUSD will function as a “collateralized-debt-position” stablecoin, meaning that users must deposit collateral to take out a loan in crvUSD. However, the protocol has yet to identify the preferred asset users can leverage as collateral. Despite this, Curve Finance remains a significant player in the DeFi space, with its TVL currently pegged at about $4.4 billion by DeFiLlama.

Overall, the successful deployment of crvUSD smart contracts represents a significant step towards its release. While the competition in the algorithmic stablecoin space is stiff, Curve Finance’s reputation and TVL may give it an edge over other players. However, the final integration into DeFi’s user interface will determine the success of crvUSD in the coming months.