{"id":440573,"date":"2020-10-05T23:00:26","date_gmt":"2020-10-05T23:00:26","guid":{"rendered":"https:\/\/www.wncen.com\/?p=440573"},"modified":"2020-10-07T11:00:01","modified_gmt":"2020-10-07T11:00:01","slug":"this-yearn-finance-yfi-trend-could-lead-to-serious-volatility-going-forward","status":"publish","type":"post","link":"https:\/\/www.wncen.com\/news\/yearnfinance\/this-yearn-finance-yfi-trend-could-lead-to-serious-volatility-going-forward\/","title":{"rendered":"This Yearn.finance (YFI) Trend Could Lead to Serious Volatility Going Forward"},"content":{"rendered":"
Yearn.finance\u2019s governance token \u2013 YFI \u2013 has been subjected to immense volatility throughout the past few days and weeks, which has come about due to conflicts within the community and weakness across the entire DeFi ecosystem.<\/p>\n
This downtrend that has sent the cryptocurrency from highs of over $40,000 to recent lows of $16,000 came about due to a combination of different factors.<\/p>\n
One such event that contributed to this was the recent Eminence imbroglio, in which users rushed into an uncompleted smart contract being developed by Yearn founder<\/a> Andre Cronje.<\/p>\n Despite it being well known that minting tokens from an uncompleted smart contract can be incredibly risky, users who lost their money due to the contract eventually being exploited still aimed their frustration at Cronje.<\/p>\n This compounded the technical weakness that the cryptocurrency had been seeing as a result of the market-wide downturn, eventually leading to a capitulatory selloff down to lows of $16,000.<\/p>\n One analyst is noting that lower yields on YFI-related yield farming opportunities is also removing the incentive to keep tokens off of exchanges.<\/p>\n As such, it may soon bear witness to heightened volatility in the days and weeks ahead.<\/p>\n At the time of writing, Yearn.finance<\/a> is trading up just under 10% at its current price of $20,400. This marks a massive upswing from its recent lows of $16,000 that were set just a couple of days ago when it faced a capitulatory selloff.<\/p>\n The rebound from these lows has been significant and suggests that it was severely oversold at this time.<\/p>\n Now that it has posted a \u201cv-shaped\u201d recovery, it may be poised to start reversing its downtrend and moving higher.<\/p>\n While speaking about Yearn.finance\u2019s current outlook, one analyst alluded to<\/a> imminent volatility, explaining that more tokens will likely be moved to exchanges as farming incentives decline.<\/p>\n \u201cMissing in the discussion of Yearn’s retreat in price – less yield farming opportunities for YFI means less incentive to keep the token off-exchange, leading to a material increase in CEX inventory (read: available for sale).\u201d<\/p><\/blockquote>\n <\/p>\n Where the cryptocurrency trends next will likely depend largely on the aggregated DeFi sector<\/a>, but it may see heightened volatility as more investors trade it on exchanges.<\/p>\n Yearn.finance\u2019s governance token \u2013 YFI \u2013 has been subjected to immense volatility throughout the past few days and weeks, which has come about due to conflicts within the community and weakness across the entire DeFi ecosystem. This downtrend that has sent the cryptocurrency from highs of over $40,000 to recent lows of $16,000 came about due to a combination of different factors. One such event that contributed to this was the recent Eminence imbroglio, in which users rushed into an uncompleted smart contract being developed by Yearn founder Andre Cronje. Despite it being well known that minting tokens from an uncompleted smart contract can be incredibly risky, users who lost their money due to the contract eventually being exploited still aimed their frustration at Cronje. This compounded the technical weakness that the cryptocurrency had been seeing as a result of the market-wide downturn, eventually leading to a capitulatory selloff down to lows of $16,000. One analyst is noting that lower yields on YFI-related yield farming opportunities is also removing the incentive to keep tokens off of exchanges. As such, it may soon bear witness to heightened volatility in the days and weeks ahead. Yearn.finance\u2019s Price Rebounds from Recent Lows At the time of writing, Yearn.finance is trading up just under 10% at its current price of $20,400. This marks a massive upswing from its recent lows of $16,000 that were set just a couple of days ago when it faced a capitulatory selloff. The rebound from these lows has been significant and suggests that it was severely oversold at this time. Now that it has posted a \u201cv-shaped\u201d recovery, it may be poised to start reversing its downtrend and moving higher. Analyst: YFI Being Moved into Exchanges Could Perpetuate Volatility While speaking about Yearn.finance\u2019s current outlook, one analyst alluded to imminent volatility, explaining that more tokens will likely be moved to exchanges as farming incentives decline. \u201cMissing in the discussion of Yearn’s retreat in price – less yield farming opportunities for YFI means less incentive to keep the token off-exchange, leading to a material increase in CEX inventory (read: available for sale).\u201d Image Courtesy of Light. Where the cryptocurrency trends next will likely depend largely on the aggregated DeFi sector, but it may see heightened volatility as more investors trade it on exchanges. Featured image from Unsplash. Pricing data from TradingView.<\/p>\n","protected":false},"author":499,"featured_media":439607,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[83402],"tags":[79667,79666,81710],"class_list":["post-440573","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-yearnfinance","tag-yfibtc","tag-yfiusd","tag-yfiusdt"],"acf":[],"yoast_head":"\nYearn.finance\u2019s Price Rebounds from Recent Lows<\/strong><\/h2>\n
Analyst: YFI Being Moved into Exchanges Could Perpetuate Volatility<\/strong><\/h2>\n
Image Courtesy of Light.<\/pre>\n
Featured image from Unsplash.\r\nPricing data from TradingView<\/a>.<\/pre>\n","protected":false},"excerpt":{"rendered":"