Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
The DeFi market continues to hit milestones as DeFi tokens are raging in the cryptocurrency market. DeFi has got many other crypto projects interested as they look to expand their platform capabilities for DeFi over the next few months.
Decentralized Finance (DeFi) has been the fastest-growing sector of the cryptocurrency market for 2020. The total market cap of the top 100 DeFi coins has now moved past $17.6 billion as per CoinGecko. Hitting another milestone, the total value locked in DeFi Projects has now crossed $9 billion.
Of all the DeFi projects, Aave leads the pack with $1.71 billion locked. Following it are other top five projects like MakerDAO, Balancer, Curve Finance, Yearn.Finance, and Synthetix. Yearn’s YFI token has been the second-best performer in DeFi on weekly charts gaining over 150%.
Decentralized Finance (DeFi) continues to make noise as more and businesses are looking to move on the blockchain. The Ethereum blockchain remains as the first choice for DeFi projects and is the top host for DeFi apps. The DeFi activity on Ethereum has surged massively over the last few weeks resulting in a surge in DeFi fees. ChainLink’s LINK has been one of the top performers for 2020 and the largest DeFi coin with a market cap of over $6.2.
Apart from Ethereum, other market players like Binance and TRON have also shown interest in the DeFi market. The two platforms have announced that they would expand the DeFi capabilities of their platforms by the end of 2020.
DeFi Projects: Yearn.Finance (YFI) Coin Making Much Noise
The Yearn.Finance (YFI) has been the top-performing DeFi coin over the last week. It has swiftly climbed the ranks to become the third most-valued DeFi coin by market cap. At press time, YFI is trading at a price of $31,873, 155% on weekly charts, with a market cap of $753 million.
Value-wise, the YFI token remains as the costliest in the crypto market with its price going past $31,873 per token. Last week, the YFI token price also surged above $38,000 on Binance with its market cap hitting $1 billion. Analyst Tyler Reynolds recently did some cash-flow analysis for DeFi and has suggested valuations of $15 billion.
500k $YFI = $15B mcap
If it traded at 50x FCF, then it would need to generate $300M for holders
It’s already generating $20M and that will go up as yUSD/yCRV grows
Add in other new arb opportunities & products (eg insurance) and we’re not far from $300M in FCF
— Tyler Reynolds (@tbr90) August 29, 2020
On the other hand, a top crypto researcher with a pseudo name – Haus – has suggested investors maintain caution. Haus pointed at some fundamental challenges that include poor market liquidity. He added:
“$YFI may be ripping right now, but it’s illiquid as hell as very little of the supply is available on exchanges. Try selling even 100k and you’ll tank the price by 3%. For comparison, the slippage on selling $100k worth $LEND (another DeFi coin with a similar market capitalization) is 0.2%”
Going further, we can see some more DeFi coins make much noise in the market.