A proposal to pre-mint 60 million crvUSD for Curve’s new Yield Basis AMM is causing a stir in the community, raising questions about governance and risk management. Yield Basis, a Curve-native AMM aimed at reducing impermanent loss in Bitcoin pools, is requesting this significant allocation to support its first three pools—wBTC, cbBTC, and tBTC. While supporters argue that the pre-mint serves as a borrowing cap since crvUSD will be paired with BTC rather than sold, skeptics highlight potential risks, including a lack of backing and governance concerns, especially amid recent losses from vulnerabilities in adjacent infrastructures. Suggestions for improvement include structuring the request as a capped credit line and ensuring proper risk mitigation techniques like insurance vaults. Although Yield Basis plans to launch with its own governance token, there is apprehension about the risks Curve might undertake without adequate oversight. The outcome of the proposal may hinge on whether it is refined to include more stringent safety mechanisms and better governance practices.

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