Yearn Finance is planning to mint 6K more YFI, which will be added to the current supply after the vote for inflation to fund future projects got passed. Voting was opened in late January and ended on February 2 at 18:00 UTC. The voting exercise took place on the online app Snapshot. Those eligible for the vote were required to stake about 4,089 YFI to a specified Ethereum block number.
The number of voters proposing the inflation against the opposers was 1,670 to 331. Six members of the Yearn multisig then sealed the final decision. The members’ approval, who act as Board of Directors in the Yearn Finance Ecosystem, signaled the start of the production of more YFI tokens.
The number of YFI tokens available on the Ethereum network is 30,000, with 29,969 circulating currently. At the time of writing, YFI’s price is above $33.8K with a market cap valued at over $1 billion. The price has almost had a 9% increase in the last 24h.
The Ups and Downs of the YFI Token
Yearn Finance came to life last year and was valued at $804, as seen on Coinmarketcap. Throughout the financial year of 2020, the price fluctuated up and down as more and more investors dug in. During the first few weeks, YFI’s price reached $4.1K, and it looked to go even higher.
The token achieved an all time high record in September 2020, hitting the $43K mark. However, by the end of the month, it sunk to $22K. YFI did not exactly do financially well until November, when it bounced back to values as high as $29K. To date, the price of the altcoin has not gone below the $20K mark.
Words on the financial streets claim that YFI has certainly gotten overvalued, and the pricing of the token does not seem sustainable. Nevertheless, the high price could result from how scarce the digital assets are on the market. The move to inject more coins into the Yearn Finance network looks like an effort to reward the DeFi token developers.
What the Inflation Means For the YFI Token
The additional coins will be put in the multisig wallets and managed solely by the team that developed Yearn Finance. DeFi analysts are wary of how the inflation will affect the recent YFI pricing upward trend.
The locked supply chain of the YFI coins has somewhat made the profitability of investing in the tokens ‘assured.‘ Adding more to the cup contradicts the past decision by Yearn Finance stakeholders who approved the destruction of YFI minting keys.
Whether it is the right decision to add more coins or not is still debatable. Nonetheless, if there’s anything sure, more YFI tokens will be added to the supply chain.