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Here’s Why Yearn.Finance (YFI) Remains Long-Term Bullish After 35% Drop

Yearn.finance (YFI) remains in an advantageous position despite its strong correction from local highs, analysts say. Like Bitcoin, Ethereum, and other top digital assets, YFI has faced a strong retracement over recent days as legacy markets have been crushed by a rising dollar. The decentralized finance coin has been hit especially hard, actually. Check out […]

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Yearn.finance (YFI) remains in an advantageous position despite its strong correction from local highs, analysts say.

Like Bitcoin, Ethereum, and other top digital assets, YFI has faced a strong retracement over recent days as legacy markets have been crushed by a rising dollar. The decentralized finance coin has been hit especially hard, actually.

Check out the chart below, which shows that the Ethereum-based coin has faced a steep correction over recent days after peaking just shy of $40,000.

Chart of YFI's price action over the past few weeks from TradingView.com
Related Reading: These 3 Trends Suggest BTC Is Poised to Bounce After $1,000 Drop

YFI Has Room to Grow

YFI has room to grow after its strong downtrend, analysts say.

Santiment, a blockchain analytics firm, shared this tweet below just recently explaining why YFI remains in a positive state from a longer-term perspective. The company noted that users of Aave are depositing YFI into the lending pool, social volume for the cryptocurrency has remained strong, and data suggests vast accumulation is taking place with the coin.

All these trends working in confluence should drive YFI higher in the longer run.

Along with this, the underlying Yearn.finance protocol has continued to collect a vast and increasing amount of fees, which should allow YFI to accrue value in the long run.

Related Reading: There’s an “Unusual” Amount of Bitcoin Sellling Pressure From Miners

An Index Play

Although YFI isn’t exclusively linked to all DeFi protocols, many analysts say that the coin is basically a decentralized finance index.

Fortunately, this segment of the crypto is expected to continue growing as capital, both human and financial, continue to enter the space. This bodes well for the Ethereum-based coin, which will likely see further growth as DeFi gains traction.

On why YFI is on the verge of seeing longer-term growth, Andrew Kang, a crypto venture capitalist and DeFi analyst, noted that there are market trends that indicate growth is just starting:

“DeFi has been around for years, but has only recently received serious recognition in the crypto community. But even with the buzz, the levels of understanding, usage, and capital allocation are all still low with high upside potential. **DeFi development** It’s hitting an inflection point. Those that have follow the space know how hard it is to keep up with the new projects even when researching on a full time basis.”

Other investors in the space expect more growth, with many citing the lack of yields that are offered in traditional finance when compared to DeFi. YFI stands to benefit all this, especially if it continues down the path of being a leading yield aggregator.

Related Reading: Here’s Why This Crypto CEO Thinks BTC Soon Hits $15,000
Photo by Ryan Shultis on Unsplash
Price tags: yfiusd, yfibtc
Charts from TradingView.com
Here's Why Yearn.Finance (YFI) Remains Long Bullish After 35% Drop

Source: https://www.newsbtc.com/2020/09/05/heres-why-yearn-finance-yfi-remains-long-term-bullish-after-35-drop/?utm_source=rss&utm_medium=rss&utm_campaign=heres-why-yearn-finance-yfi-remains-long-term-bullish-after-35-drop

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Blockchain

Chainlink, Synthetix, Verge Price Analysis: 05 March

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The altcoin market showed that market bears were in the ascendancy over the past week, with the same likely to continue over the next few days. Chainlink approached an area of demand at $25, while Synthetix faced rejection at the $27-level. Finally, Verge flipped the $0.019-level to support, although this development could be short-lived.

Chainlink [LINK]

Chainlink, Synthetix, Verge Price Analysis: 05 March

Source: LINK/USD on TradingView

On the 4-hour chart, LINK registered rising bearish momentum as the RSI dropped below 50. It was noting a value of 40, at the time of writing, and faced an area of demand in the $24.8-$25.8 zone. This could see LINK bounce to retest the $27-level as resistance.

The imminent levels of interest seemed to be $27, as likely resistance, and $24.8, as support. A drop below $24.8 would see the bears push further and climb to touch the $23.24-level of support.

The $23.24-level has been tested as support multiple times since early February, and certain on-chain metrics did point to a fall in the number of LINK users, which, in turn, could see less demand and lead to further losses.

Synthetix [SNX]

Chainlink, Synthetix, Verge Price Analysis: 05 March

Source: SNX/USDT on TradingView

SNX was trading within a descending channel for the better part of February, and a few days ago, broke out of the pattern with a technical target of $27.

SNX tested the $24-mark as resistance but its attempts to climb any further were met with rejection. SNX has since steadily posted losses and lost the $21-level to the bears. The MACD formed a bearish crossover and began falling to show downward momentum.

Over the next few days, the $19.7 and the $18.5-$19 zone can be expected to serve as support.

Verge [XVG]

Chainlink, Synthetix, Verge Price Analysis: 05 March

Source: XVG/USDT on TradingView

The ascending trendline had some confluence with the retracement level at $0.019, and the market bulls were able to defend that level. Closing a trading session under the $0.0189-level would likely see XVG drop back towards $0.0165, while a breakout past $0.021 would be a bullish development. A move lower was the more likely scenario, given the general market conditions.

Even though the DMI showed the bullish trend gaining some strength in recent days, the trading volume was in disagreement with the rally. The Awesome Oscillator was moving above zero, but did not show bullish strength.


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Source: https://ambcrypto.com/chainlink-synthetix-verge-price-analysis-05-march

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The Flash Mint is here: WETH10 turbocharges the flash loan concept

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A team has released WETH10, the latest iteration of the Wrapped Ether token that allows using Ether (ETH) in a DeFi setting. WETH10 carries a host of useful features, the most notable of which is the flash mint, an evolution of the flash loan concept.

Flash loans allow users to borrow the entire liquidity pool of a protocol to use as they see fit, without posting collateral. The only limitation is that the loan must be returned in full within the same transaction, otherwise the loan will never exist in the first place.

In the DeFi community, flash loans are primarily a tool for arbitrage, as they offer an unlimited source of funds for anyone transacting entirely within the DeFi ecosystem. This includes liquidation bots, with one lucky liquidator making $4 million from scratch in November by using flash loans. Another class of flash loan users are hackers and protocol exploiters, who often use them as a source of funds for their attacks.

The flash loan’s prevalence in hacks has made the concept somewhat controversial, with some arguing that they are net negative for the ecosystem and should be removed. For others, they represent one of few meaningful DeFi innovations, which democratizes access to arbitrage.

One limitation of flash loans is that the total sum available for a transaction is limited by the liquidity locked in a particular protocol. This is where the concept of a flash mint comes into play — instead of taking funds from a liquidity pool, the mechanism mints tokens out of thin air and destroys them once no longer necessary.

The amount that can be obtained from a WETH10 mint is not really infinite, Alberto Cuesta Cañada, technical lead for Yield Protocol and developer of WETH10, told Cointelegraph:

“The only limitation to flash mints of WETH10 is that the flash minted amount can never exceed 2^112-1 at any given time.”

In decimal terms, the number quoted by Cuesta Cañada has 33 zeros, which should be enough to cover any liquidity needs in DeFi. In practice, if the user needs to unwrap the WETH for a particular use, there may be limitations due to how much ETH is stored on the WETH contract.

Most DeFi protocols actually use WETH in the backend, though they hide this from users by automatically wrapping and unwrapping it at each interaction. If they were to switch to WETH10, the flash mint could grow to its full potential.

Will projects adopt the new standard?

“The new standard will be adopted slowly, it it gets adopted,” said Cuesta Cañada. “It is not users, but applications, that might adopt WETH10, and nothing might be seen for at least a couple of months.”

Adopting WETH10 only for the risk of amplifying potential losses from coding mistakes may be a tough proposition, but the new token carries a host of other advantages. WETH10 includes the ability to make transactions free for the end user, and it skips the “approve token” mechanic to save on gas costs and avoid security threats. An additional benefit of WETH10 is that its flash mint is completely free, unlike flash loan protocols levying their own fees.

Cuesta Cañada believes that newer projects will have an easier time integrating the standard, with existing names possibly doing so in their next releases. It is yet unclear if DeFi projects believe the risks of flash mints outweigh the benefits from the new WETH standard. “No one has committed to use it yet, but we haven’t gone looking for it either,” said Cuesta Cañada. He concluded:

“If the selling proposition of WETH10 is good enough, it will be adopted. If it is not, such is life, we all learnt a lot and had a great time coding it.

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Source: https://cointelegraph.com/news/the-flash-mint-is-here-weth10-turbocharges-the-flash-loan-concept

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Why there’s more to Chainlink’s growth than what meets the eye

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After a collective collapse a week ago, the digital asset industry recovered somewhat, before falling once again. However, it would seem that Chainlink missed the memo in the first place. In fact, AMBCrypto had recently reported about LINK’s inability to pull-forward without the assistance of strong on-chain fundamentals.

While its long-term credentials remain golden, during the aforementioned phase of corrections, LINK’s active addresses and receiving addresses fell to monthly lows. However, recent data might be suggesting a shift, one that may just confirm once again the narrative drawn by the previous article.

Chainlink’s brief rise above $30 saw significant Address Activity

Over the past 72 hours, LINK has been on a topsy-turvy journey on the charts. While the altcoin did recover briefly to touch $30, it soon fell on the back of the rest of the crypto-market reeling too.

However, what must be noted here is that when LINK was climbing, so was its on-chain activity, an observation that backed the notion that LINK’s hikes are usually always supported by strong on-chain fundamentals.

Source: Twitter

In fact, Santiment data showed that Chainlink registered its highest single-hour level of address activity over the last seven months. Around 26,700 addresses were active during the 1-hour window, a finding indicative of high on-chain activity.

The cohesion between the altcoin’s price and active address conformed with the narrative drawn in the previous article, one that highlighted the importance of network development for LINK’s value.

In the past, certain crypto-assets such as Bitcoin SV, Bitcoin Cash, etc., have depended on their correlation with Bitcoin more than anything else, for price appreciation. On the contrary, Chainlink is re-defining its interest and mostly basing its growth on market engagement.

Citi Group suggests LINK may gain upper hand against Bitcoin

Citi Group’s recent report bestowed major props to Bitcoin, identifying its intrinsic value and interest while suggesting that the asset could become the currency of choice for international trade.

In the same report, however, Citi also drew a comparison between LINK and BTC. The concluding sections of the report highlighted that Chainlink was recently recognized by the World Economic Forum as one of the 100 most promising technologies of 2020.

Chainlink has expanded beyond expectations, gaining adoption on other blockchains such as Polkadot as well. The report added,

“It is thus already possible to envision a commerce-linked or infrastructure-linked coin that may eventually eclipse Bitcoin. Innovation in the chain-based ecosystem is continuing apace and today’s offerings may yet give way to a new invention that garners more attention and assets than Bitcoin.”

Is LINK eyeing another breakout?

Source: Trading View

On the weekly chart, Chainlink seemed to be pointing towards another price hike, especially if bullish momentum is considerable over the next few weeks. As identified by the chart, Chainlink might be on its next rally phase, similar to the one it saw towards the end of July 2020. The same can be confirmed by the higher position of the 21-day Exponential Moving Average over the 20-Moving Average on LINK’s weekly price charts.

Higher accumulation at the current range may kick off the rally, therefore, keeping an eye out for whale movement will be imperative over the next few weeks.


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Source: https://ambcrypto.com/why-theres-more-to-chainlinks-growth-than-what-meets-the-eye

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