Post Vyper Exploit - CRV Market Update and Recommendations

We’re receiving various questions regarding the proposals within this thread. For clarity and transparency, we’ll post a summary here.

What Does LTV → 0 Accomplish?

Regrettably, setting LTV to 0 isn’t a silver bullet for preventing exposure. It can be bypassed in V2 through flash loans, as elaborated here.


A sophisticated user can still deposit an asset and increase borrows, meaning our ability to diminish increased CRV exposure is not absolute.

Again, we’re not against this adjustment; however, it is crucial to comprehend the level of protection it can and cannot provide.

LT Reductions

We’re leading an initiative to progressively lessen exposure to V2 assets, particularly those with risk profiles that have intensified significantly over the past year due to thinning liquidity and market cap. Our latest proposal to reduce CRV LTs received approval; however, we refrained from execution as the implications and risk of such a reduction expanded considerably. In the intervening period between the governance vote approval and the AIP execution, the Vyper Zero Day vulnerability was identified and exploited in various Curve pools. Given the current market volatility, we intend to await stability, re-evaluate the market circumstances, and subsequently propose additional reduction plans.

Disabling $CRV Borrowing on Ethereum and Polygon V3

We recommend disabling CRV borrows on the Ethereum and Polygon V3 deployment to minimize the potential of shorting CRV or borrowing CRV to dump and further impact price. It seems there is consensus to do this, and we are preparing a proposal.

Market Freeze

This constitutes the most significant aspect of our ongoing discussion. Hence, we propose moving forward with a vote involving two options:

  1. No Market Freeze
  2. Market Freeze

As always, we’re available on all channels. Don’t hesitate to reach out if you have any questions or need clarification.