Yearn Finance’s governance token YFI reached a new milestone on Friday as its price crossed over the $50,000-mark for the first time in history.
The gains appeared as Grayscale Investments, a New York-based cryptocurrency management firm, . That prompted traders to raise their bids for YFI, given Grayscale’s critical role in shooting Bitcoin prices upwards after accumulating almost 3 percent of the flagship cryptocurrency’s active supply for its proprietary Bitcoin Trust.
The YFI Bull, Explained
Grayscale’s core business model offers accredited investors the opportunity to gain exposure in cryptocurrency markets by purchasing shares of its open-ended private trusts that hold the digital assets in concern. For instance, its Grayscale Bitcoin Trust, or GBTC, has 649,130 BTC to date and its per-share cost is around $48 over-the-counter.
The company accumulates additional crypto-assets based on institutional demand. Therefore, analysts typically consider its buyouts as bullish for the concerned assets. As it shows interest in launching a Yearn Finance trust, bulls believe the move would bring high-profile investments into the decentralized finance sector.
Yearn Finance off to close the day at record levels. Source:
YFI peaked at $50,592 on Friday. Its price is now comparable to Bitcoin, which peaked above $49,000 on the same day.
Traders anticipate the price to grow higher. A pseudonymous analyst on Twitter that YFI could push for a $150,000 valuation based on its technical readings against Bitcoin. In retrospect, the YFI/BTC exchange rate showed signs of breaking out of a bullish channel, leaving the analyst with a strong upside bias.
Yearn Finance shows upside strength against Bitcoin, as shown by GalaxyBTC. Source:
“YFI coin supply on exchanges has been gradually decreasing since November 2020 where it saw the highest Coin supply on exchanges since launch and price bottomed out, suggesting that capitulation has taken place,” said analysts at Santiment.
“This gradual drop in YFI is healthy and positive as there’s less sell pressure on exchanges,” they added.