How much can Curve benefit from the success of Yield Basis Curve DAO can benefit significantly from the success of Yield Basis, but the specific effects depend on several key fund flows and different scenarios of participant behavior. Firstly, it is necessary to clarify the token and revenue flow between the two applications and DAO. Based on the original proposal of crvUSD providing credit limit to YB, I have summarized the following key points: YB does not directly add TVL to Curve, they have their own pool, but based on Curve technology. In YB's token economy model, 30% is allocated for this purpose and distributed in the form of veCRV. The token issuance of YB is not fixed, it depends on project indicators and the proportion of locked positions in veYB. Curve DAO will receive 35% to 65% of the YB tokens received by VeYB, depending on VeYB's lock up rate. It's already a bit complicated. Don't worry, it will be more complicated next. The YB received by Curve DAO can be used to stimulate the liquidity of any pool, such as enhancing the depth of the crvUSD stablecoin pool. Because BTC<>crvUSD transactions will eventually enter the crvUSD<>USDC pool, this will increase the demand for crvUSD and also increase Curve's fee income. VeCRV and vlCVX will receive these issuance revenues through vote incentives. Special attention should be paid here (see CRV Retirement Guide Part 2: vlCVX - The simplest path to obtaining election bribery income). In other words, Curve has two sources of income: one ️⃣ Direct token allocation from YB: 30% (initially 25%), plus 7.4% Curve pool authorization fee (see token allocation chart in YB ICO). two ️⃣ The additional commission income generated by YB's arbitrage operations in the Curve pool. Two other important points to note: YB borrowing crvUSD does not directly pay transaction fees to veCRV. YB's pool handling fee will be divided into two parts: one part will be left in the pool, and the other part will be given as an admin fee to veYB (the ratio is dynamic). If you pledge your ybBTC position, you will receive YB as a reward, and the fee income will be diverted to the admin fee. After understanding these, we can try to estimate the impact of Yield Basis startup on Curve DAO. The question is, from which perspective is the most appropriate to start? These impacts are mostly indirect, designed through incentive mechanisms, and highly dependent on participant behavior, not just YB data indicators. If simplified, you can refer to Michael's statement on AMA: In the future, YB's TVL may be comparable to Curve. In other words, according to the previous calculation, it can increase Curve's market value by approximately 37%. However, we will still try to use numbers to push and see the effects in different scenarios. For modeling purposes, we assume that: YB participants are rational. The value of YB tokens obtained by Curve DAO from YB's revenue is approximately equal to YB's fee income. On average, Curve earns 50% (between 35% and 65%) of YB income. In terms of valuation, take the current price to sales ratio P/S of Curve on DefiLlama as 15. ✍️ Curve DAO Revenue Effect Calculation benchmark data Current annualized income (veCRV holders): 61.01M Assuming Curve receives 50% of YB's revenue. parameter YB's return on LP: 15% APR (based on test data) • Scenario: YB TVL is 30M, 200M, 1B, 5B respectively Result (see attached image) TVL YB 200M: Curve Revenue 76.01M → Market Value 1.14B TVL YB 1B: Curve Revenue 136.01M → Market Value 2.04B TVL YB 5B: Curve Revenue 436.01M → Market Value 6.54B Note: These data have not taken into account secondary effects such as organic growth in DEX fees and additional arbitrage brought about by deep liquidity. I just made these calculations myself, hesitating whether to share them publicly. The final decision is that even if the data is just a fantasy, it can at least provide some material for everyone to think about. P. The author is a community ambassador for Curve. Reprinting source: https://t.me/zeroresurrect