Guide: Stake & Provide Liquidity on Curve

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Providing liquidity in decentralized finance (DeFi) has become a cornerstone strategy for crypto investors seeking passive income. Among the leading platforms enabling efficient liquidity provision is Curve Finance, a specialized decentralized exchange (DEX) built for stablecoins and wrapped assets with minimal slippage. For holders of stETH or wstETH—tokens representing staked Ethereum through Lido—Curve offers an attractive opportunity to amplify returns by combining staking rewards with trading fees and incentive emissions.

This guide walks you through how to stake, provide liquidity, and maximize yields on Curve using Lido’s liquid staking derivatives, while explaining key concepts like yield types, gauges, and reward claiming.

Understanding Curve Finance and Its Role in DeFi

Curve Finance operates as an automated market maker (AMM) optimized for trading assets with similar values—such as stablecoins or yield-bearing tokens like stETH and wstETH. Unlike traditional AMMs that use constant product formulas (e.g., x*y=k), Curve employs advanced algorithms to minimize slippage, making it ideal for large swaps between pegged assets.

One of Curve’s standout features is its voting-escrow economic model (veTokenomics). Liquidity providers (LPs) can lock their CRV tokens to receive veCRV, which gives them voting power and allows them to direct emissions to preferred liquidity pools. This mechanism concentrates liquidity where it's most needed, boosting rewards and deepening market efficiency.

For Lido users, this means enhanced earning potential when supplying stETH/wstETH pairs on Curve.

👉 Discover how to boost your staking returns with seamless liquidity provision

How to Provide Liquidity Using stETH or wstETH

To begin earning on Curve, follow these steps:

  1. Access the Curve Platform: Visit curve.fi and connect your wallet (e.g., MetaMask).

  2. Navigate to the Appropriate Pool: Look for pools involving stETH or wstETH, such as:

    • stETH/ETH
    • wstETH/ETH
    • wstETH/stETH
  3. Deposit Your Tokens: Select the amount of stETH or wstETH you wish to contribute. You may deposit one or both sides of the pair depending on the pool’s configuration.
  4. Receive LP Tokens: Once deposited, you’ll receive LP tokens representing your share of the pool. These tokens accrue base trading fees automatically.

By participating in these pools, you earn:

Maximizing Yield: Staking LP Tokens in Gauges

Not all rewards are distributed automatically. To access the full spectrum of earnings, you must stake your LP tokens into a gauge.

The Three Types of Yield on Curve

  1. Base vAPY
    This reflects the passive income generated from swap fees and embedded staking rewards (like daily ETH staking yield from stETH). It accrues directly to your LP position and requires no further action.
  2. tAPR (Token APR)
    This represents additional token incentives—often distributed in CRV or other governance tokens—allocated to liquidity providers who have staked their LP tokens in a gauge.
  3. Incentive Rewards tAPR
    Some pools receive boosted rewards from external protocols (e.g., Lido may incentivize liquidity for stETH pairs). These are only claimable after locking LP tokens in the correct gauge.
⚠️ Important: If you do not stake your LP tokens into a gauge, you will miss out on tAPR and incentive rewards—even if your assets remain in the liquidity pool.

How to Claim Incentive Rewards

After staking LP tokens in a gauge:

  1. Go to the “Withdraw/Claim” section on Curve.
  2. Click “Claim Rewards” to withdraw accrued CRV, LDO, or other incentive tokens.
  3. Repeat periodically—rewards do not compound automatically.

Regular claiming ensures you capture all available yields without leaving money on the table.

👉 Start earning multi-layered yields with integrated DeFi strategies

Frequently Asked Questions

Will I still receive daily stETH staking rewards when providing liquidity on Curve?

Yes. When you supply stETH or wstETH to a Curve pool, your underlying assets continue to accrue Ethereum staking rewards because stETH rebases over time. These rewards are reflected in the increasing value of your stETH holdings and are already factored into the base vAPY shown on Curve.

Do I need to stake my LP tokens in a gauge to earn all available rewards?

Absolutely. While base swap fees and staking yields accumulate automatically, extra incentives—including CRV emissions and protocol-specific bonuses like those from Lido—are only distributed to users who have actively staked their LP tokens in a gauge. Skipping this step significantly reduces your total return.

Can I withdraw my liquidity at any time?

Yes, you can remove your liquidity whenever you choose. However, if your LP tokens are staked in a gauge, you must first unstake them before withdrawing funds from the pool. Be aware that some incentives may have vesting periods or withdrawal delays.

What risks should I be aware of when providing liquidity?

The primary risks include:

Always conduct due diligence and consider diversifying your DeFi exposure.

Is there a minimum amount required to provide liquidity?

No strict minimum exists, but smaller deposits may result in lower proportional returns due to gas costs during deposit, claiming, and withdrawal actions. It’s generally more cost-effective to make larger, less frequent transactions.

How often should I claim my rewards?

There’s no fixed rule—it depends on reward size and gas prices. If accumulated incentives outweigh transaction fees, it makes sense to claim. Some advanced users use automation tools or monitor dashboards to optimize claim timing.

Final Thoughts: Unlocking Compound Returns in DeFi

Combining Lido’s liquid staking with Curve’s low-slippage liquidity pools creates a powerful synergy for yield-seeking investors. By contributing stETH or wstETH to well-incentivized pools and properly staking LP tokens in gauges, you unlock multiple income streams:

This layered approach exemplifies modern DeFi strategies—where capital efficiency and compounding mechanisms work together to generate sustainable returns.

Whether you're new to liquidity provision or refining an existing strategy, understanding how Curve’s ecosystem functions empowers smarter decisions and better outcomes.

👉 Optimize your DeFi portfolio with high-efficiency liquidity solutions

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