Curve Finance launches Llamalend v2 on Optimism with 250,000 OP token grant

Jun 10, 2026

Curve Finance has launched its upgraded lending protocol, Llamalend v2, on the Optimism network, supported by a 250,000 OP token grant. The new version removes crvUSD restrictions, allowing flexible collateral like Curve LP tokens, and introduces a curated market model managed by LlamaRisk. The launch is a phased rollout, starting with lending-only markets, ahead of a planned Ethereum mainnet deployment.

Llamalend v2 launch on Optimism

▪Curve Finance has launched Llamalend v2, its isolated lending protocol, on the Optimism network.
▪The launch on Optimism is the initial phase of a major upgrade to Curve Finance's lending infrastructure.

Flexible collateral and borrowing pairs

▪Llamalend v2 removes the previous version's restriction to crvUSD pairs, supporting multiple collateral and borrow assets like LP and PT tokens.
▪The protocol replaces hard liquidations with soft liquidations, which gradually rebalance collateral into the borrowed asset as prices decline.

Curve LP tokens as collateral

▪Users of Llamalend v2 can use Curve LP tokens as collateral.
▪Using Curve LP tokens as collateral allows liquidity providers to maintain trading exposure while borrowing against their positions.

LlamaRisk market curation model

▪As market curator, LlamaRisk provides qualitative evaluations for new collateral, manages the market lifecycle, and sets risk parameters.
▪LlamaRisk will serve as the market curator for Llamalend v2, a change from v1 where anyone could create isolated markets.
▪The curated market model is intended to be safer and easier for users, who no longer need to manually evaluate each market's safety.

Optimism Foundation grant distribution

▪The Optimism Foundation provided a 250,000 OP token grant, worth about $50,000, to support the launch.
▪The 250,000 OP tokens will be distributed as incentives over approximately two months to bootstrap early liquidity.

Phased deployment before Ethereum mainnet

▪Deploying on an Ethereum Layer 2 network first is a security strategy to test the protocol in a more contained environment.
▪A seven-day DAO voting period will determine the borrow caps before the markets become fully operational, with a rewards campaign planned for June 16, 2026.
▪At launch, Llamalend v2 markets on Optimism have a zero borrow cap, allowing users only to lend.
▪The Optimism deployment precedes a planned release on the Ethereum mainnet, expected in the second half of 2026.