2020-7-27 18:00 |
After a parabolic rally, the Ethereum decentralized finance (DeFi) market experienced a blow-off top over the past week. As reported by CryptoSlate previously, many of the top players, such as Chainlink (LINK), Synthetix Network Token (SNX), and Kyber Network (KNC), are down greatly since local highs.
With this recent price action, the question of if the DeFi bubble has popped is one that has crossed the mind of many in the crypto space. This may seem to be the case on the surface level. But then if you look a little deeper, at certain token valuations, it becomes clear that this is anything but the case.
Ethereum DeFi’s new darling coin, yearn.finance (YFI) gains 100,000% in a weekAt least for the time being, Ethereum DeFi investors are moving on from the tried and true investments of LINK and SNX and are focusing their efforts on new players.
Last week, the developers of yearn.finance (a.k.a. iearn.finance), a recently-launched Ethereum-based DeFi platform, rolled out its native token: YFI. Like many other DeFi protocols, the token was distributed through a “liquidity mining” incentive system, where investors that use the protocols get the coin as a reward.
What was different about YFI, though, compared to Compound’s COMP or its other contemporaries, was how far it rallied just days after its launch.
According to prominent crypto analyst and VC investor Andrew Kang, at $3,000, YFI is up 1,000 times — that’s to say 100,000 percent — since its launch around eight days ago:
“YFI is now the second 1000x I’ve seen in the last few weeks. For those questioning the math, the balancer pool launched at $3 YFI, but CMC and Coingecko did not start tracking the price until sometime after.”
YFI is now the second 1000x I've seen in the last few weeks.
Officially full bull market https://t.co/Gc7cEiY3md pic.twitter.com/a9wIWA4Naz
— Andrew Kang (@Rewkang) July 24, 2020
What’s especially absurd about the rally in this Ethereum-based token is that in the launch’s Medium post, yearn’s main developer ardently asserted that the token has zero value. Read the following excerpt from that post:
“We have released YFI, a completely valueless 0 supply token. We re-iterate, it has 0 financial value. There is no pre-mine, there is no sale, no you cannot buy it, no, it won’t be on uniswap, no, there won’t be an auction. We don’t have any of it.”
As it turns out, the crypto market has begged to differ, imbuing YFI with a fully diluted market valuation in excess of $80 million.
A rally just starting?With such strong price performance, a price that is starting to edge into Bitcoin’s territory, and a launch that some say replicates that of BTC, YFI has created quite the stir on Crypto Twitter.
Most, interestingly, are not bearish.
Molly, someone working in the crypto space known for insights on industry trends in Asia, commented that YFI is the “hottest DeFi project” in China.
“Pretty much all the WeChat groups i am in are talking about YFI, and many people I’ve know are trading YFI. I would say YFI is by far the hottest new Defi project in Chinese crypto space,” she commented.
Tony Sheng, formerly of Multicoin Capital, then released a Substack blog entitled “YFI Ponzinomics,” in which he outlined how the asset has a design that promotes price appreciation.
The blog outlines how the asset’s low circulating supply (currently at 30,000 coins max), demand drivers through governance and staking, and “rigged pools” are forcing prices higher.
The post A new Ethereum DeFi token is literally up 100,000% in a week: VC appeared first on CryptoSlate.
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