After being decried and then copied, the YFI token continues to make a name for itself by surpassing the price of the Bitcoin. Thus, it is exchanged at almost $15,000 for “only” $11,800 for the queen of the cryptocurrencies.
YFI above Bitcoin?
The governance token of the yEarn.finance protocol, the YFI, has just eclipsed Bitcoin by reaching its all time high at $16,000 on August 20th. On the other hand, Bitcoin doesn’t look good, and is struggling to get back above $12,000.
Launched on July 17th, the YFI chip has been making headlines. For its part, the price followed the trend and recorded an increase of 47,415% in the space of a month, according to Coingecko’s data.
Evolution of the YFI share price since its launch – Source: Coingecko.
For some, this crazy boom is soon coming to an end. For others, it is not about to stop.
Indeed, although its unit value is higher than that of a Bitcoin, the YFI marketcap is not comparable to that of Bitcoin. On the one hand, the Queen of Cryptomoney has a marketcap of $218 billion compared to only $422 million for YFI.
The extremely high price of YFI is closely correlated with the low number of tokens in circulation. For example, only 29,962 YFIs are in circulation and this number is not expected to increase so much given that the maximum offer is set at 30,000 tokens.
YFI: the useless token… or almost useless
This increase can irritate many people because of the lack of usefulness of the YFI token. Indeed, let us recall that this governance token was announced as “worthless” and, as a result, some may extrapolate that its usefulness is also nil.
However, it does have a usefulness, as it allows participation in the governance of the protocol. In addition, once staked to vote, it allows for “earning a percentage of the fees that are accrued from the various Yearn Finance products”, as explained in the documentation.
As investor Ian Lee explained, the importance of YFI lies not in its current value, but in what it conveys.
“$YFI “flipping” $BTC price is arbitrary & more psychologically than practically important. What is important is what @iearnfinance is doing & @AndreCronjeTech is building in DeFi.
” – A statement he made on Twitter.
Indeed, in addition to being one of the most egalitarian token distribution since the creation of Bitcoin – that is, all the tokens were distributed without premise – YFI is the showcase for the yEarn protocol, which is one of the most active and innovative protocols in the DeFi ecosystem.
On the one hand, yEarn is a protocol that can be likened to an intelligent bank account that automatically allocates funds into several lower risk strategies to help optimize returns. However, that’s not all, as the protocol offers different products, the latest being a crypto insurance with yinsure.finance.
In any case, the YFI token is not about to stop being talked about. The constant innovations and the ultra-community aspect of yEarn have the potential to make it one of the most influential protocols in the DeFi sphere.