Curve Whipsaws 75% as DeFi Degens squeeze Avraham Eisenberg

CRV experienced a 75% swing after self-proclaimed “Applied Game Theorist” Abraham Eisenberg launched a seemingly backfired plan to short the token.

curve whale game

One of cryptocurrency’s most notorious whales is at war with Curve.

Avraham Eisenberg, a self-described “applied game theorist” responsible for last month’s $100 million Mango Markets exploit, has started shorting Curve DAO’s CRV token.detective on chain noticed On Tuesday morning, Eisenberg borrowed 88 million CRV tokens from lending protocol Aave and sold them to the market earlier in the past week.

Curve Finance is a decentralized exchange focused on stablecoins and other low volatility assets to maintain low slippage and fees. It is generally seen as a more conservative option in DeFi and is popular among liquidity providers for that reason. CRV is its governance token.

The pressure created by the Eisenberg sale took CRV down to $0.40, allowing it to borrow and sell more CRV from Aave’s Curve pool. Many bystanders have speculated that Eisenberg was targeting Curb founder Michael Egoroff for a short sale. Egorov reportedly has a loan backed by CRV tokens on his Aave with a liquidation price of $0.25. If Eisenberg manages to raise the price of his CRV to this level, Aave’s liquidation deal will be triggered, and Egorov’s CRV will be sold to the market to pay off the debt and drive the price down further.

However, several whales reacted to Eisenberg’s attack and started opening long positions to increase the price of the CRV token. “First, he came for mangoes and I didn’t speak up.” murmured PleasrDAO member Andrew Kang on Tuesday with a photo of his CRV long position. “Now he’s trying to seek out a loan for one of his DeFi godfathers, but it’s time for him to step in to defend.”

Over the next few hours, the curve climbed steadily, eventually reaching the Eisenberg liquidation level just above $0.60. Aave’s liquidation mechanism has initiated the sale of USDC collateral to buy back his CRV tokens from the market to pay off debt. However, many who were long the Curve at $0.40 today seem to have started taking profits at this level and shortened the liquidation. Overall, about $5 million in Eisenberg’s positions were liquidated in that event.At the time of writing, his position was beginning to be liquidated Alsopushing the CRV above $0.70.

While many bystanders mark the episode as Eisenberg’s loss, others are unconvinced. murmuredThe post is widely recognized as “psyops,” or tactics aimed at manipulating opponents or enemies using psychology. The idea is that Eisenberg is trying to lure his enemies into a false sense of security before revealing his final plan.

Eisenberg may also have a much larger off-chain long position in CRV, intending to liquidate the Aave loan from the beginning to fuel the CRV bull market and profit from the volatility. Others argue that he is taking his time before using more capital to push the CRV price down and once again challenge Egorov’s $0.25 liquidation price.

Another somewhat quirky theory is that Egorov and Eisenberg planned the entire spectacle from the beginning to spark interest in the Curve protocol.By chance, Egorov It was published The code for Curve’s upcoming stablecoin is available today on GitHub.

Eisenberg rose to notoriety in the cryptocurrency industry after using price-fixing tactics to exfiltrate $100 million in user funds from the Solana-based Mango Markets protocol in October.rear reveal yourself In general, Eisenberg made a deal with Mango Market’s team to return half of the stolen funds to cover the losses of the users if Mango Markets used the financial funds to cover the losses.

Eisenberg has sparked outrage in the DeFi community by saying Mango Markets is abusing a “highly profitable trading strategy.” While some in the DeFi community believe Eisenberg has done nothing wrong, others have strongly criticized his actions and their negative impact on the space.

Whether Eisenberg was beaten or whether his partial liquidation was all part of his plan remains to be seen.DeFi enthusiasts will be watching closely to see what happens next. Eisenberg also appears to be moving money to deposit as collateral to stop Aave’s liquidation.

Disclosure: At the time of writing this article, the author owned ETH and several other cryptocurrencies.