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Yearn.Finance's YFI Token Surges 22% to Record Price - CoinDesk


www.coindesk.com 11 May 2021 15:29, UTC
Reading time: ~2 m

The digital-asset management platform Yearn.finance’s governance token, YFI, jumped 22% Tuesday to an all-time high price, joining the recent months’ rally in cryptocurrencies linked to the fast-growing decentralized finance sector, known as DeFi.

YFI clocked a new high of $78,019 around 14:30 coordinated universal time and was changing hands near $74,500 at press time.

The token’s price has tripled this year, including a 40% rise in May alone, with the majority of those gains occurring in the past 24 hours. But YFI has lagged behind other DeFi standouts, including a gain of about 700% for the decentralized lender Aave’s AAVE token, and a roughly 400% rise in Maker’s MKR.

“The rally was overdue, given the token’s relative underperformance compared to other DeFi blue chips,” Denis Vinokourov, head of research at Synergia Capital, told CoinDesk in a Telegram chat. 

While the token is still trailing its DeFi peers in price this year, the protocol has seen stronger growth in recent weeks.

Just since the start of April, Yearn.finance has more than doubled the collateral locked into its protocol, to about $4.1 billion, according to the website DeFi Pulse. During the same time frame, the total value locked in the DeFi space has increased by 70% to $80 billion.

“Yearn’s growth trajectory has been very strong,” Vinokourov said.

YFI has a very small circulating supply, at around 36,000 coins, according to data aggregator CoinGecko. That helps explain why the token, which has a market capitalization of about $2.6 billion, has a higher price than the $56,558 bitcoin (BTC), which has a market value of $1.06 trillion.

Ease of use of YFI in a hot DeFi market, in addition to low supply, may be contributing to the high price.

“It’s been the Tesla of self-driving investment management,” said Rich Rosenblum, co-founder of crypto market maker GSR, an investment manager and analyst in the cryptocurrency space.

Rosenblum said he’s concerned about YFI’s competition heating up, however.

“Crypto moves a lot faster than autos, and others are hot on the trail,” Rosenblum said.

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