Yearn.finance (YFI) has surged higher in the past 24 hours despite stagnation in the price of Bitcoin and Ethereum. The leading cryptocurrency, which is in the top 30 by market capitalization, is up 20% in the past 24 hours, having moved from around $25,000 to $29,000 as of this article’s writing. It is one of the top-performing altcoins in the top 100.
Yearn.finance (YFI) May Have Room to Rally After Retaking $29,000
Analysts say that YFI has room to move higher after gaining 20% in the past 24 hours.
One trader shared the chart below on September 26th. It shows that while YFI remains far below its all-time high, it recently secured a crucial exponential moving average that it held above during the previous rally.
YFI doing so, the trader explains, suggests that the ongoing rally has “juice.”
Chart of YFI's price action over the past few weeks with analysis by crypto trader Crypto Krillin. Chart from TradingView.com
Analysts think that all of the DeFi space is set to grow. With Yearn.finance acting as a pseudo-index for the entire market, YFI will benefit if the rest of the industry gains traction.
Andrew Kang, the founder of Mechanism Capital, recently touched on the topic of DeFi’s growth in an extensive Twitter thread.
Kang explained that the fundamentals and technicals of this industry suggest that DeFi is poised to move higher. Mechanism Capital previously came out with a report stating that YFI could hit $250,000-350,000 in the coming years assuming a bullish discounted cash flow analysis.
“In terms of new funds entering, I’m aware of at least a dozen that have recently raised or just finished raising. Many of these intend to play in the public secondary markets. Unclear how much gets deployed over what timeline… In terms of DeFi activity growth, TVL continues to advance parabolically after a small dip even in the face of price stagnation indicating more assets moving in. For both public and private DeFi projects, the innovation and pace of development continues forward at a blistering pace – even faster than it was two months ago.”
Spencer Noon, head of DTC Capital, has echoed the optimism. He recently said that the fundamentals for Ethereum and Defi “have actually never looked better.”
As aforementioned, YFI stands to benefit from a further recovery in DeFi.
On Friday afternoon, a number of Twitter users began to notice large withdrawals of Ethereum and ERC-20 tokens from Kucoin’s designated addresses. In the span of about thirty minutes, about $150m worth of ETH tokens left the wallets marked “Kucoin” and “Kucoin 2” on Etherscan.
As the coins that were withdrawn were basically all the capital that was in these addresses, many were quick to assert that it was a hack. But for hours, there was silence on Kucoin’s end, with the exchange’s moderators sharing little information about what had transpired.
A few hours after these suspicious withdrawals, admins of Kucoin’s social media channels asserted that users’ deposits were safe.
While this is true in that users will be compensated, Kucoin just confirmed that the withdrawals were made by a malicious actor as opposed to the company.
Users Affected by KuCoin Hack of Millions in Bitcoin, Ethereum & ERC-20 Tokens Will Be Compensated
Just minutes ago, approximately seven hours after the Ethereum withdrawals, Kucoin revealed that it had undergone a “security iandncident.”
The company’s internal security auditing team found that “part of Bitcoin, ERC-20, and other tokens in KuCoin’s hot wallets were transferred out of the exchange.” The funds that were withdrawn from the exchange comprised a “few parts of our total assets holdings.”
No clarifications were given to the exact specifics of the cryptocurrency stolen, but independent analyses that over $10 million worth of Bitcoin was taken from Kucoin-owned addresses. The $150 million worth of Ethereum and ERC-20 tokens — most of which are in Alchemy, Tether’s USDT, Ampleforth, and Ocean Token — withdrawn seems to be related to the attack. It cannot be properly ascertained of this is the case, though, at least not until a follow-up report from Kucoin.
The funds stolen from Kucoin’s addresses were funds stored in the exchange’s hot wallets as opposed to its cold wallets, which remain “safe and unharmed.”
All users affected by the incident will be compensated by Kucoin and the firm’s insurance fund:
“We are locating the reason for the incident, and will keep you updated once it is confirmed. Please rest assured that if any user fund is affected by this incident, it will be covered completely by KuCoin and our insurance fund.
Kucoin Shares (KCS), the exchange’s Ethereum-based token, is down 11.2% on the news of the hack. It was relatively stable prior to this latest news.
The Power of DeFi
While the ramifications of the hack are still pending, analysts have been quick to say that this accentuates DeFi’s value proposition.
With decentralized exchanges like Uniswap, users always have custody of their own funds, disallowing such large-scale hacks from taking place.
Photo by 大爷 您 on Unsplash
Price tags: ethusd, ethbtc
Charts from TradingVIew.com
$150m of Ethereum & ERC-20 Tokens Hacked From KuCoin Will Be "Covered"
By Friday, August 7th, the ETH seems to gave lost its absolute confidence in further growth but its overall mood remains positive. This promises a chance of growth after the pause. Today the ETH is generally trading at 396 USD.
On H4, the uptrend of the ETH has passed the level of 38.2% Fibo related to the preceding long-term declining wave. Technically speaking, there is a correction forming on the chart after swift growth. After the correction and a breakaway of the high at 415.26 USD, the next goal is likely to be 50.0% Fibo (455.05 USD). However, for now, after a divergence on the MACD, an impulse of declining has corrected the previous growth to 38.2% Fibo. The next wave of growth is testing the area near the high but the market seems to be preparing another wave of decline.
On H1, wait for a decline to the support level and 368.45 USD. If this level is broken away, this will confirm the formation of another wave of decline. The aims of the decline might be 50.0% (315.50 USD) and 61.8% (292.20 USD). However, judging by the dynamics of the Stochastic, the quotations might equally rise and test the high.
Adam Back, the head of Blockstream, states that the ETH, along with other altcoins, demonstrates a range of features that make it look like a crypto pyramid. Simultaneously, the financier who the market thinks to be the creator of the ETH – Satoshi Nakamoto – is sure that behind each altcoin there is a personality comparable to the father of financial pyramids Charles Ponzi.
According to Back, the problem of the ETH, as of many other altcoins, is the distribution of assets. At the same time, he says that Ethereum and Ripple are rivals in a contest for being the most important fraud scheme.
Why are we talking about fraud at all? Back comments that as long as 70% of the initial altcoins have been mined by their creators, the mining schemes are non-transparent and can never become transparent.
However, the ETH rate is hardly influenced by such comments: general market moods are much more important, and they are satisfactory.
Any predictions contained herein are based on the author’s particular opinion. This analysis shall not be treated as trading advice. RoboForex shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.
The latest Ethereum rival saw its native token, AVAX, rising by more than 1300 percent in its first hour of trading on September 22. A jump from $0.85 to $12.54 was enough for attracting profit-takers. Thereby, a strong sell-off ensured, and the price crashed.
But despite the bearish correction, AVAX/USD up by 450 percent from its exchange rate open. The pair is consolidating sideways, showing a minimal inclination to extend its move lower. On the other hand, it appears that the token is waiting for more buyers so it could sustain its uptrend.
AVAX/USD maintaining its gains despite a 65% downside move. Source: TradingView.com
The bullish cues come from what AVAX represents: a smart contract platform–another Ethereum killer in the making–that comes up with an exciting way to tackle its rival’s current shortcomings.
Avalanche Crash Course
In retrospect, AVAX’s parent protocol, Avalanche, is a multi-blockchain network that consists of three base platforms, each having a critical role to play while protecting the core from a single point of failure.
The X-Chain, for instance, handles the creation of new digital tokens and their exchange between core blockchains and their respective subnets. The C-Chain, on the other hand, manages the design and launch of Solidity-based applications by using a so-called “consensus mechanism” to confirm transactions and make changes.
Avalanche's three platforms explained. Source: Messari
The third and the last in the line is P-Chain. It is a base staking platform that handles network validators – a kind of a decentralized finance protocol. Therefore, every validator must stake on the P-Chain to run the Avalanche’s “Primary Network.”
Meanwhile, the network allows validators to break off into small groups to manage one or more subnets.
From the first look, Avalanche’s idea of having a base network model appears to borrow heavily from decentralized finance projects, Polkadot and Cosmos. Nevertheless, the Ethereum rival comes by its own by tweaks, including a penalty-less staking environment, a hard cap of 720 million AVAX tokens, and a fees burning mechanism.
“The network burns any tokens used to pay transaction fees on its three core chains,” noted Messari researcher Wilson Withiam. “Based on monetary policy alone, Avalanche has a better claim on being a hard monetary asset than most competitors, including Ethereum pre EIP-1559 (ducks for cover).”
What’s Next for AVAX
AVAX expects to stand tall by the sides of Polkadot’s DOT and Cosmos’s ATOM by wearing a rigid monetary policy and a more comfortable validator experience. The token could further benefit should there be a departure from Ethereum over its higher transaction fees.
Avalanche has already enabled its C-Chain to allow Ethereum developers to port their projects onto its network via an EVM called Athereum – a so-called “friendly fork” of Ethereum. Its launch would enable all the ETH users to claim Athereum’s native token ATH.
“Ava Labs spent a good portion of the last few years in stealth mode and has placed marketing on the back burner in favor of pushing out its mainnet,” said Mr. Withiam. “Now is the time to flip the switch, especially with a functional ETH 2.0 so far from grasp.”
With over $1.2 billion in Bitcoin now on Ethereum for DeFi use, Alameda Research continues to lead the with another $25 million worth of WBTC in a historic mint.
Although Bitcoin’s price has over the past week retraced to lows of $10k and then capped below $10,800, one metric that has kept growing is the number of Bitcoin inflows into decentralized finance.
Since July, Bitcoin tokens on Ethereum have jumped 10%, hitting over $1 billion in value.
Meanwhile, whales have moved over $120 million worth of Bitcoin from wallets and exchanges in the past 24 hours. According to Whale Alert, seven huge transactions of up to 3,500 bitcoins in a single batch were observed from Binance to various unknown wallets.
Alameda Research mints historic quantity of WBTC
In mid-September, about 100,000 bitcoins were on Ethereum. That number had risen to 114,077 Bitcoin tokens as of September 25th (10:00 UTC), according to data tracked by Dune Analytics.
Of this number, the largest percentage is in the ERC-20 token Wrapped Bitcoin (WBTC). According to Elias Simos of Dune Analytics, nearly three-quarters of all the Bitcoin tokenized on Ethereum is minted in WBTC to allow BTC holders to participate in the decentralized finance space (mostly in yield farming).
Wrapped Bitcoin provides for 73.6% of the minted synthetic Bitcoin. The second-largest tokenized BTC is in the form of renBTC at 18.4% and a distant third going to HBTC with 4.22% of the market share.
More than 83,000 WBTC have been minted on the Ethereum network as of writing, with the largest share controlled by Alameda Research, a trading platform co-founded by FTX CEO Sam Bankman-Fried.
Per data on crypto tracking site Nansen, Alameda Research has minted more than 37,600 WBTC tokens so far. The company minting the second-largest share of WBTC is CoinList with 29,000 tokens, while imToken ranks third with nearly 9,000 synthetic Bitcoins.
On September 25th, Alameda Research made history after minting 2,317 Wrapped Bitcoin tokens worth about $25 million. It, therefore, meant the company had surpassed the 2,316 WBTC that Three Arrows Capital successfully minted on September 24th.
Yearn.Finance (YFI) had such an abrupt rise to fame, now that momentum has changed, the plunge could be equally as dramatic. Thus far, any attempt to hold above support has been weak, says one crypto analyst.
They also claim that YFI is currently on “life alert” and in danger of a much more drastic fall if the DeFi token cannot hold strong here.
Yearn.Finance Falls Back To Support At Recent Local Low, Lingering On “Life Alert”
What makes this token so much more valuable than Bitcoin price-wise, is just like the leading cryptocurrency by market cap itself: digital scarcity.
There are only 30,000 YFI tokens, making what little liquidity to enter the token supply a powder keg for explosive price action. Unfortunately, this also works in reverse, as YFI holders are seeing right now.
But when the DeFi token finally turns back around, it could be an investment of a lifetime due to just how limited the supply is.
Featured image from DepositPhotos, Charts from TradingView