DeFi deep dive: What is CORE and why has volume topped $90m?

Cvault.finance's CORE token has exploded on decentralised exchange Uniswap over the weekend, racking up almost $100 million in daily trade volume

This week’s DeFi deep dive examines a new yield farming protocol that has created a unique deflationary currency named CORE.

CORE can be staked and farmed at cvault.finance, where users can achieve APY’s of up to 950% for depositing Uniswap liquidity tokens into the protocol.

Users are free to stake, and unstake, at their own command but they are unable to convert liquidity tokens back into CORE or Ethereum.

This means that all tokens that are used to provide liquidity effectively become dormant, reducing the circulating supply and causing buy pressure.

With a fixed total supply of just 10,000, it was easy to see how CORE had drawn early comparisons with Yearn Finance (YFI), which has a total supply of 30,000 and a market cap of $874 million.

Deep dive with CORE’s lead developer

Coin Rivet spoke to the project’s lead developer, who goes by the pseudonym 0xRevert, to discuss the genesis of the project and how investors are safeguarded.

“CORE has a limited supply of 10,000. There is absolutely no new coins ever.” They said when explaining what sets CORE and other yield farming protocols apart.

0xRevert added: “All farming rewards come from 1% transfer fee on each token send. Previous farming tokens just created them out of thin air and hyper inflated – this is why they had a life span of three days. Farming with LP that is locked creates ‘skin in the game’ – which solves the fly by night whale problem – people who don’t care about about success of the coin and just want free coins.”

One of the recent criticisms lobbied at DeFi projects has been the potential proliferation of bad actors, ponzi schemes and cash grabs.

The way in which CORE was created effectively removes the risk of a shady move from the team behind the project, as revealed by 0xRevert: “We started CORE with something I call a ‘liquidity generation event’.

“All core that will be ever created was put inside a smart contract, that people could put ETH into for a week. Then all of this was transferred at the same time to create liquidity – and LP tokens went back to people who provided it.

“This process was totally automatic and we had no control of it. And received no tokens or ETH from that. It was effectively a new way to start liquidity without any pre-sales or founder tokens.”

As volume and liquidity begins to mount on Uniswap, there has been natural calls for the CORE token to be listed on centralised exchanges like Binance and Coinbase.

However, 0xRevert believes that “most of the volume and liquidity will remain on uniswap” as CORE is “deeply integrated with it” in that it has a lot of permanently locked liquidity.

The roadmap

In true DeFi fashion CORE’s website is a Windows 95 skin with a built in version of classic desktop game Minesweeper. Looking past that and there isn’t too much to go off apart from a Medium post and the staking pools.

The Medium post mentions how governance will be a fundamental feature of the project as it will allow token holders to vote on potential staking pools and APY changes.

“Future updates after governance will bring strategy vaults, that are designed to create more volume in CORE. And therefore generate more fees for farmers.” 0xRevert added.

There is also plans to award early pre-sale investors with a unique “merch token” which will be given out once the team can secure manufacturing and distribution for it. The lead developer confirmed it would be an erc-20 token and not an erc-721 or erc-1155.

While the immediate future of CORE certainly looks bright with almost $17 million locked up in liquidity, it’s worth noting that yield farming protocols are experimental technologies that carry a number of inherent risks.

Earlier this month investors of Yam Finance lost out when a rebase bug was exposed, causing the supply to multiply exponentially.

Although Coin Rivet’s research found no vulnerabilities or discrepancies within the code of CORE, it urges readers to do their own research before putting any capital into experimental projects like this.

Disclaimer: This is not financial advice. The author of this article does not own or have a vested interest in CORE.

For more news, guides and cryptocurrency analysis, click here.

Related Articles