Yearn Finance (YFI) was able to surge by over 65% in the last 24 hours, reaching a price per coin of $31,890. This is the highest price the digital asset reached and it could continue to expand. The main question analyst make is related to whether it will be possible for this virtual currency to continue moving higher.
Yearn Finance Exploded by 65%
The Decentralized Finance (DeFi) market continues to attract a large number of investors and users from all over the world. Some of the projects have been helping users to profit with the price of the underlying digital assets. Yearn Finance has been a hot topic in recent days as it surged above $31,000.
Yearn Finance if a financial protocol that was created a few months ago and that aims at improving liquidity in the DeFi market. In this way, the funds deposited by users will be used as liquidity for those projects that are currently offering the best performance.
In order for this to happen, Yearn Finance created a series of smart contracts that do not require the intervention of a centralized authority. The YFI token was also created in order for users to participate in the Yearn Finance ecosystem.
Despite being used as a governance token, the YFI digital asset skyrocketed in recent times. The interesting thing about this token is that there are only 30,000 YFI in existence. That means that if demand skyrockets (as it already did) the price will definitely be affected.
Since July 21st, YFI surged by over 3,880% until today. This is massive growth for a digital asset that its creator claims it has no financial value. At the same time, this digital currency is used as leverage in other DeFi protocols.
Arthur Hayes, the CEO of BitMex, wrote on Twitter that he believes that YFI could skyrocket to $100,000 in the future. Many consider that this could even go higher if the YFI bubble continues. Indeed, in a second Tweet, Hayes repeated that 1 YFI could reach $100,000.
— Arthur Hayes (@CryptoHayes) August 30, 2020
YFI and the DeFi market is currently resembling the bubble experienced by Bitcoin and the Initial Coin Offering (ICO) craziness back in 2017 and early 2018. If this continues to grow without a correction, we could see the market plummeting and the whole industry affected.