Curve Finance is a Decentralized Exchange (DEX) that runs on the Ethereum, Fantom, xDai and Polygon Blockchains. Its design facilitates pain-free swaps between stablecoins. All that users need is an Ethereum wallet and some capital in order to swap different stablecoins with low fees and slippage. Some call Curve Finance ‘a Uniswap for stablecoins,’ and as a result of its unique pricing formula, Curve is also ideal for executing swaps between different tokenized versions of a coin.
Whereas most exchanges match a buyer with a seller, Curve uses liquidity pools like Uniswap. This means that liquidity (tokens) is required and rewarded by those who provide it.
Curve’s liquidity pool enables direct token trades among classified pairs, and thanks to its direct swap function, users pay comparably lower trading fees. When placed alongside other DeFi protocols, while Uniswap focuses on maximizing available liquidity, Curve’s algorithm focuses more on minimizing slippage. This means that, by using Curve, traders save more.