Convex Finance [CVX] announced some changes to the way staking works on its protocol as part of its 2023 reforms.
The Convex team noted in a Medium post on January 2 that there had been no significant changes to the CVX staking yield on the Curve Finance [CRV] pool since its launch.
The DeFi platform did, however, reveal that there will be some updates to the wrapper contract for cvxCRV. According to the blog post, the new wrapper contract will allow for additional cvxCRV staking incentives. Furthermore, users may receive rewards in only CRV or only CVX.
Convex’s fee structure has also changed in addition to the rewards. Convex revealed in the communique that the fee structure change would allow cvxCRV to circulate. According to the blog post,
“At the protocol level, Convex hopes to be able to divert two percent of platform fees to acquire and stake existing cvxCRV toward the new wrapper contract. The cvxCRV acquired and staked this way will add to the wrapper’s overall rewards, while removing cvxCRV from circulation.”
Convex Finance also stated that once the staking changes are fully operational, it will deploy a factory pool. Following the update, CVX development activity jumped from the zero zone to 0.1. This meant that Convex’s network upgrade was reflected in its on-chain condition.
When it came to network expansion, Santiment’s data revealed that it had stalled. The network growth rate was eight at the time of publication. Because of the status’s simplification, no new addresses were created on the network. As a result, CVX adoption fell precipitously.
Further on-chain analysis revealed that CVX did not fail in every way. At the time of writing, circulation had been active for the previous seven days. Growth in this regard implied that a significant amount of CVX tokens were used during the period.
The transaction count, on the other hand, exemplified the network growth trend. The transaction count was 34 at the time of publication. This meant that CVX transactions over the network were insufficient to have a positive impact on the Convex ecosystem.