Curve Finance founder Michael Egorov has paid back $1.3 million worth of Tether (USDT) in a move that appears to ease concerns around the large debt taken by his wallet from lending protocol Aave. Egorov had previously deposited $24 million worth of CRV tokens to Aave on Monday, but the bearish sentiment in the crypto market caused prices of several tokens, including CRV, to drop more than 10% on a weekly basis.
The partial payback eases risks associated with the large loan, said a source. The recent decline in Curve’s CRV token, with a 24% weekly decrease and a current trading price of 57 cents, has raised concerns about potential liquidation and selling pressure.
As of Thursday, the wallet holds over 288.7 million Curve DAO (CRV) tokens, valued at $167 million at current prices, and has around 60.7 million USDT borrowed against it. This position represents over 30% of the total CRV token supply and has drawn attention among some Crypto Twitter community members for the risks it may present to the broader decentralized finance (DeFi) sector were it to be liquidated.
Egorov had initially borrowed stablecoins on Aave in April, with $37 million worth of Tether (USDT) being sent to crypto exchange Bitfinex and $51 million in USDC being sent to prominent market maker Wintermute, according to blockchain sleuth Lookonchain. The open position currently has a health rate of 1.55, and the collateral will be automatically liquidated if it drops below 1.00.