Here’s the first of my 90-days challenge posts and it seemed only logical to talk about YFI - the altcoin that took everyone by surprise. If someone tells you they’re riding this from the beginning intentionally, they’re likely to be lying.
Now, I’m sure most of you who’ve been following the developments in the DeFi space are well aware of YFI and what it did to the industry, but let’s do a quick recap anyways.
What is YFI and why is everybody losing their minds?
For starters, YFI is a token based on Ethereum’s ERC20 standard. It’s the governance token for the popular yield farming aggregator yEarn.finance.
In an official blog post dated July 17th, Andre Cronje announced the project with a few core products, including:
As you can see, he’s created an entire ecosystem of DeFi-facilitating products, including automated market makers, delegation protocols, liquidity pools, leveraged DAI vaults, automated liquidation engine fo Aave, and so forth.
However, in an effort to give up control of the entire protocol, Cronje and his team created YFI. Here’s where it gets interesting.
In his own blog post, Cronje wrote the following:
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. 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.
The only original way users could get YFI was through providing liquidity to one of the platforms listed above, stake the output tokens in distribution contracts and earn an amount of it per day.
Now, needless to say, YFI was listed on Uniswap, and on many other exchanges but more on that below.
So, essentially, YFI holders get to participate in the governance of the entire protocol and they can also stake it for various liquidity rewards.
YFI’s jaw-dropping performance
The first thing that you need to know about YFI is that it has a fixed supply of 30,000 tokens and absolutely none of that was kept by the team. All of them were released as rewards for providing liquidity to the protocol’s different products.
So, people began farming. However, the incentives to stake YFI are so substantial, and the supply is so limited, that its price eventually skyrocketed.
Let’s ignore the fact that it was supposed to have 0 financial value as Cronje said, and accept the first available price on CoinMarketCap as our ground zero. Back on July 22nd (less than one month ago!!), YFI was trading at $840. Now, it’s trading at around $15,000. That’s a whopping 1700% increase. Keep in mind though, that there was a time before that when YFI was trading at prices below $100, making the increase a LOT more impressive.
More interestingly, YFI became the first altcoin to flip Bitcoin’s price today. Technically, ZEC also did it back when it got launch but that was because of its very tiny initial supply and the proof-of-work algorithm.
So is it worth buying it?
A lot of people might think that this is a bubble that’s about to pop. That’s the thing, though, there are actual fundamentals behind YFI.
It’s a very scarce token with enormous use cases. Yield farmers are going mental over liquidity provision and YFI is still among the most valuable tools to do so. Many experts believe that the token is unlikely to slow down, mainly because there’s just such a huge demand for it and there’s NOT enough supply.
Now, there are talks within the community that holders will vote to split YFI 1:10 if the price continues to be higher than BTC for 10 consecutive days.
If this happens, the supply will increase 10x. Holders are unlikely to lose money on this because they will (supposedly) receive an increased amount of YFI that should offset the inflated supply (kind of like a rebase). I’m unsure of the details here and don’t want to jump to any conclusions so as always, do your own research!
I personally think that YFI has plenty of room to grow and normal market dynamics for crypto don’t really apply, given the state of the DeFi market.
Where to Buy YFI?
If you want to gain exposure to YFI, you can use MXC Exchange. It’s one of the most liquid exchanges and it probably has the greatest variety of cryptocurrencies on the market.
MXC is also well-known for supporting a lot of DeFi coins, so if you don’t want to miss out on those and are uncertain of using Uniswap, this is likely your best bet.
If you want to buy YFI through MXC Exchange, click here or, alternatively, the image below.
Yes, the links are referrals, and it would mean the world to me if you used them. You won’t lose anything but I’ll make a small commission on your trading fees, which allows me to keep creating posts of the kind.
Thanks for reading, now to the good part:
THIS IS A GIVEAWAY POST. PLEASE LEAVE A COMMENT WITH YOUR BTC ADDRESS IF YOU WANT TO BE INCLUDED IN THE FINAL GIVEAWAY ON NOVEMBER 25th.
To learn more about the BTC giveaway and my 90D90P challenge, take a look at:
Daily snapshot August 20th:
Giveaway Pool: $72.3