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Yearn.finance (YFI) surges 30% in 1 day: what’s fueling the rapid rally?

The price of YFI, the native token of the decentralized finance (DeFi) giant Yearn.finance, surged 30% in 1 day.

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The price of YFI, the native token of the decentralized finance (DeFi) giant Yearn.finance, surged 30% in 1 day.

YFI rose from $21,500 to as high as $28,151 on Binance within 12 hours, demonstrating strong momentum.

yfi yearn.finance
The 4-hour chart of YFI, the native token of Yearn.finance. | Source: TradingView.com

Three key factors have buoyed the short-term rally of YFI: its extended consolidation, an expanding development team, and recent controversies.

Factor #1: extended consolidation

Since its initial drop to sub-$20,000 on September 5, YFI had been ranging mostly between $21,000 and $23,000.

For altcoins, which tend to see substantially higher volatility than Bitcoin or Ethereum, a five-day consolidation phase is relatively long.

Due to its exponential rally throughout August, YFI also had not seen many periods of consolidation. Hence when the price of YFI exceeded $23,500, it caused a strong rally to a major resistance level.

Throughout the past five days, YFI was below short-term moving averages for the majority of the time. Technically, that caused momentum to build over time and it fueled a huge spike in volatility.

Factor #2: an expanding development team behind Yearn.finance

Yearn.finance has rapidly expanded since early August, especially as the demand for the yETH vault massively increased.

The yETH vault allows ETH holders to gain yield by simply placing their tokens within the vault. According to stats.finance, Yearn.finance has $1.124 billion in value locked. Out of the $1.124 billion, $438 million are locked in the vaults.

yearn.finance
Yearn.finance’s vault stats and total value locked. | Source: stats.finance

As the user activity on Yearn.finance sharply increased, the projected needed more developers to sustain the platform.

On September 10, the Yearn.finance team announced 12 new team members across development, content, and operations.

Factor #3: Recent controversies around SushiSwap boost Yearn.finance

As CryptoSlate extensively reported, SushiSwap founder “Chef Nomi” sold about $10 million worth of dev funds in SUSHI.

The sudden sell-off caused the price of SUSHI to drop by nearly 90% within seven days.

Since then, the community has seen newfound respect for Yearn.finance’s Andre Cronje and Uniswap’s Hayden Adams. They both released decentralized projects in a transparent manner, with no pre-mined financial incentives and clear governance models.

Cronje, the founder of YFI praised for transparently launching the token, said:

“Seeing a lot of projects promoting ‘multisig governance’ like it is a feature. It is a stopgap for proper governance. But proper governance takes time to formulate. Multisig is not a feature, its a crutch. If teams promote this as a feature, please think twice.”

The confluence of a favorable technical structure and the growing demand for Yearn.finance’s products fueled its recent upsurge.

Atop the strong fundamental factors, the confidence around the project has also started to improve due to recent controversies around pre-mined DeFi projects.

In July, Mechanism Capital’s Daryl Lau described the release of YFI as “a tale of fair launch.”

“Despite having the power to give himself a pre-mine or founder reward, he elected instead to keep zero tokens for himself,” he wrote.

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Source: https://cryptoslate.com/yearn-finance-yfi-surges-30-in-1-day-whats-fueling-the-rapid-rally/

Blockchain

Bank of Korea Head Says Cryptocurrencies Have No Intrinsic Value

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The head of the Bank of Korea, Lee Ju-yeol, said that Bitcoin and other major cryptocurrencies lack intrinsic value. However, he believes that all assets will continue to experience significant price fluctuations.

Price Surge Because of Pro-BTC Institutional Investors?

The chief of the Bank of Korea said cryptocurrencies, including Bitcoin, do not possess inherent value. In a recent news report, Lee Ju-yeol blasted the highly volatile nature of the digital asset industry.

“There is no intrinsic value in crypto assets,” said BOK Gov. Lee Ju-yeol at a parliamentary session on 23 February.

The news report quoted lawmakers asking BOK’s chief if the recent surge in the price of BTC is temporary or not.

“It is very difficult to predict the price, but its price will be extremely volatile,” Ju-yeol added.

The bank executive has also said that the recent rally in Bitcoin’s price followed by other significant digital assets may be led by multiple factors. Among them, Elon Musk’s Tesla – investing $1.5 billion. He highlighted that the latest price surge might be a continuation of institutional investors using Bitcoin as a hedge.

Ju-yeol also emphasized that BOK shouldn’t buy bonds issued by the country’s government directly. Otherwise, this would raise worries about fiscal stability and undermine the central bank’s trust. 

Bitcoin Volatility Bringing Some More Hard Times For Investors?

The primary cryptocurrency’s volatility has been causing quite some troubles for both retail and institutional investors. This particular character of the digital assets has been a stumbling point for many, thus, causing some hesitations in whether to allocate funds in it or not.

BTC’s price managed to initiate another notable surge during the last couple of months, marking a consequent all-time high. Just a few days ago, it skyrocketed above $58,000, dragging other altcoins like Ethereum behind it for a while.

However, almost immediately after its upgrowth, BTC suffered a significant correction, settling unsteadily around $50K as per the time of the writing. As a result, the cryptocurrency market capitalization lost more than $300 billion in two days.

Interestingly, JPMorgan strategists said recently that Bitcoin’s illiquidity could bring more problems. Analysts from the US multinational banking institution argued that BTC is in a liquidity shortage, warning investors that the primary crypto-asset could suffer another price drop.

Featured Image Courtesy of WSJ. 

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Source: https://cryptopotato.com/bank-of-korea-head-says-cryptocurrencies-have-no-intrinsic-value/

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Cross-chain bridges and DeFi integration are pushing these 3 altcoins higher

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The cryptocurrency market is showing signs of progress following a multiday sell-off that saw the total market capitalization drop by more than $400 billion as Bitcoin’s (BTC) price briefly fell below $46,000. 

While the majority of altcoins have entered a consolidation phase that includes a retest of underlying support levels, several projects have started to regain lost ground after new developments reignited investors’ optimism.

ADA/USDT

Cardano’s ADA started the year with a bullish spark that saw its price increase 624% from $0.165 on Jan. 2 to a high of $1.20 on Feb. 20. This week’s sharp correction pulled the price to a swing low at $0.80, but it is clear that traders bought the dip.

ADA/USDT 4-hour chart. Source: TradingView

Since hitting a swing low at $0.80, ADA’s price rallied 30% to $1.05 following the news that community members at Venus Protocol had approved a proposal to bring ADA to the Venus mainnet. 

VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for ADA on Feb. 14, prior to the recent price rise.

The VORTECS™ score, exclusive to Cointelegraph, is an algorithmic comparison of historic and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

Cointelegraph Markets Pro – VORTECS™ Score (green) vs. ADA price

As the chart above shows, Binance introduced staking on Feb 10., and the VORTECS™ score for ADA rose to a high at 88 on Feb. 14

MATIC/USDT

On Feb. 9 the Matic network rebranded to become “Polygon” as part of a strategic change to become a layer-two aggregator. The move was done in response to the growing momentum of Polkadot and a desire to build an interoperability protocol on top of Ethereum.

High gas fees on the Ethereum network have increased the need for layer-two solutions, and Polygon has emerged as one of the top solutions with projects like Aavegochi and Golem already operating on the protocol.

The rebrand helped lift the price of MATIC from $0.07 on Feb. 9 to an all-time high of $0.197 on Feb. 20 before the market downturn pushed it back down to $0.111 on Feb. 23.

MATIC/USDT 4-hour chart. Source: TradingView

Since that time the MATIC has recovered 62% to trade at $0.16 as the community and total value locked on Polygon continue to grow.

STX/USDT

Stacks (STX) was the breakout star on Feb. 24 as the layer-one blockchain solution designed to bring smart contracts and decentralized applications to Bitcoin saw a record $166 million in trading volume that elevated STX to a new all-time high of $1.17.

STX/USDT 4-hour chart. Source: TradingView

Excitement for the project comes after the Feb. 23 announcement that STX holders can now participate in delegated staking from the Stacks wallet, allowing them to earn BTC rewards.

According to data from Cointelegraph Markets Pro, market conditions for STX have been favorable for some time.

VORTECS™ Score (green) vs. STX price. Source: Cointelegraph Markets Pro

As seen in the chart above, the VORTECS™ score for STX hit a high of 87 on Feb. 23, around 30 hours before the price increased 75% to its new high of $1.17.

Interoperability, cross-bridge solutions and staking have emerged as drivers of growth that help incentivize investors to hold their tokens and also attract new participants to old and new blockchain projects.

Following the recent market downturn, it’s clear that projects that offer tokenholders multiple ways to earn a yield and operate across separate blockchain networks are beginning to stand out from the rest of the field.

Source: https://cointelegraph.com/news/cross-chain-bridges-and-defi-integration-are-pushing-these-3-altcoins-higher

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Former London Stock Exchange Group CEO Urges UK Government to Explore Cryptocurrencies

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The former CEO of the London Stock Exchange Group, Xavier Rolet, has advised the UK government to look into cryptocurrencies and SPACs to minimize the adverse impact of Brexit. In a recent report, Rolet claimed that the UK has trailed behind other countries in both aspects.

The UK Should Turn To Crypto And SPACs?

Born in France, Rolet is a businessman and the Chief Executive Officer of the London-based credit-focused asset management firm CQS. Before assuming this position, though, he served as the CEO of the London Stock Exchange Group and was named as one of the 100 best CEOs in the world in 2017 by the Harvard Business Review.

In a report cited by Bloomberg, Rolet touched upon the potential consequences to the UK economy following the withdrawal from the European Union and the European Atomic Energy Community, better known as Brexit.

The executive believes that the UK has two viable options to consider if it wants to minimize the risks and help the nation flourish.

In the first one, he urged the government to “promptly consider the SPAC revolution.” Also referred to as “blank check companies,” these special purpose acquisition companies (SPAC) operate as shell corporations listed on a stock exchange with the idea of buying out a private company, thus making it public. Ultimately, this strategy eliminates the need to go through a traditional initial public offering (IPO).

While the US has seen significant adoption in the past year with a 10x increase in the raised funds compared to 2019’s results, the UK regulators have halted their progress on the London markets.

Rolet’s second advice involved digital assets as he noted that “all relevant UK government agencies should be resourced to thoroughly understand cryptocurrencies.”

With proper regulations, the crypto ecosystem could “place London and the UK at the center of a reputable and safe financial market.”

The UK’s Regulatory Approach To Cryptocurrencies

While UK’s regulators have hindered SPACs’ progress within the country, the nation’s financial watchdog, the FCA, has also been rather harsh against the cryptocurrency industry.

As of the start of this year, the Financial Conduct Authority banned crypto derivatives and exchange-traded notes (ETNs) to retail customers.

Additionally, the watchdog has issued several warnings to investors that they could lose all their funds if allocated in digital assets.

The regulator also announced that all UK-based digital asset businesses need to be registered with it but extended the deadline for applications to July 9th, 2021.

Featured Image Courtesy of TheGuardian

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Source: https://cryptopotato.com/former-london-stock-exchange-group-ceo-urges-uk-government-to-explore-cryptocurrencies/

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