Yearn Finance Up 8.1% – Time to Buy YFI Coin?

There has been some significant movement in the YFI price of late, with the asset rising in tandem with several blue-chip stocks in the decentralized finance (DeFi) space. DeFi tokens – and assets in the larger crypto market – have yet to recapture their yearly highs. Still, these gains are encouraging. This article explores the rising YFI price to see how the asset is really performing and whether it’s a strong buy option.

Yearn Finance: DeFi’s Golden Child

Also known as yEarn, yearn Finance is arguably the most popular DeFi platform. Launched in early 2020 by Andre Cronje, the platform offers users access to the highest yields on their deposits – stablecoins, Ether, altcoins and others.

Cronje had found inconsistencies in the yields offered by different platforms. He built Yearn Finance to offer users a view into platforms and their yields, making it much easier for them to make choices.

Today, Yearn Finance covers a group of protocols that help to improve their yields on DeFi.

These include APY – a data table that shows interest rates across protocols; Earn – a tool that identifies the highest rates for users on lending; and Vaults – a collection of investment strategies that help to get users the highway DeFi yields.

YFI is the native token for Yearn Finance. It was launched in July 2020 as an ERC-20 token, giving holders the ability to govern the Yearn Finance protocol directly. YFI can be farmed through different methods – including providing liquidity to decentralized exchanges like Balancer and Curve Finance.

YFI’s main value proposition is the fact that it is capped. There are only 30,000 YFI tokens available, and this deflationary structure has helped YFI’s value to shoot up. After starting at just $3 in a Balancer pool, the YFI price now trades in the five-figure range.

YFI Price Movements in 2021

As the most popular DeFi token in 2020, YFI’s rise was astronomical. The YFI price shot up in a short period, beating even Bitcoin in value thanks to its hard cap.

The YFI price entered 2021 trading at $21,875. Thanks to the market rally, the asset was able to jump through successive highs time and again. It eventually hit its all-time high of $94,873 on May 12, coasting off the highs in the market and positive investor sentiment.

When May’s downturn came, the YFI price took a beating. Just five days after hitting its all-time price, the YFI price dropped as low as $34,235 – a drop of 63.9 percent. YFI eventually bottomed out at $24,012, hitting that rice four days after the previous low.

So, to put it in context, the YFI price had dropped by 74.6 percent in the space of 11 days.

Interestingly, YFI hasn’t hit that low since May. There have been successive downturns due to market slumps, but the $24,012 point seems to be the asset’s low. Of course, this isn’t to say it’s been all rosy. YFI has failed to cross the $46,000 line since May, meaning that the asset’s gains have been significantly capped.

But, there has been a lot of hope for the asset in the past month. YFI has gained a healthy 19.3 percent in the past month, and there is hope that the market rally will help the asset jump even higher.

With a current price peg of $39760, YFI is up by 8.1 percent in the past day and 8.6 percent in the past week.

YFI: Technical and Fundamental Analysis

On the technical front, YFI is hanging on – albeit barely. The asset’s moving averages (MAs) are gaining fast, with its 20-day MA standing at $39,079 and its 200-day MA $39,500. The next few days will be critical in watching if YFI will be able to hold above these averages. If it can, then bigger gains could come next.

YFI’s relative strength index (RSI) also stands at 58.60, meaning that it is quite underbought. But, the metric has been rising for the past few days, so investors are seeing the price gains and buying in. if the price gain does continue, the RSI will undoubtedly rise.

Buy YFI at eToro from just $50 Now!