Yearn Finance Price Continues To Pump Over Recent Days, Adding Fuel To Yield Farming Fire
Over the past weeks Yearn.finance has dominated conversations surrounding the booming DeFi yield farming trend touting 10,000 times growth over the past six weeks and a $33,882 price tag per unit.
In yield farming, investors move their crypto assets quickly between lending protocols in order to capture returns on varying APIs. The strategy takes commitment and careful monitoring, but the Yearn.finance protocol simplified that process by launching a smart contract which does all the monitoring and reallocating on behalf of users. The company’s native governance token YFI now holds a market capitalization of over $1.1 billion only one and half months after its launch.
There is a 30,000 hard cap on the supply of YFI tokens and all governing power for the protocol is in the hands of token holders. The developer of yearn.finance, Andre Cronje, did not pre-mine or grant himself a founder reward in true decentralized fashion.
Fair token distribution becomes increasingly important for maintaining a decentralized system when dealing with governance tokens because one investor holding a majority of tokens would be able to make all code editing decisions. Bitcoin, Ethereum, and other altcoins have been less successful ensuring even token distribution with a recent Santiment report stating that out of 855 crypto assets tracked, 727 have 50% or more of their total supply being held by only 100 wallets.
Despite the current hype surrounding the YFI token, Cronje emphasized in a Medium post announcing the launch that the coin is completely valueless.
“In further efforts to give up this control (mostly because we are lazy and don’t want to do it), we have released YFI, a completely valueless 0 supply token,” he wrote.
He emphasized that users should not buy the token, but instead earn it by providing liquidity to the listed platforms. Regardless of Cronje’s comments the YFI token is perhaps one of the fastest growing cryptocurrencies ever.
By Emily Mason