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YFI outperforms Bitcoin, again

Surely everyone knows about Bitcoin and its scandalous price increase, but the reality is that YFI surpasses it in this area. With a modest market capitalization, the yearn.finance governance token is emerging as the leading coin when it comes to value per unit.

One of the weaknesses of this project that was born within Decentralized Finance (DeFi), is its volatility. YFI ranks 36th in capitalization, topping US $ 608 million, putting it in an unsafe range when compared to other currencies.

In this sense, for example, Tezos (XTZ), which is ranked number 18 in that line, has a capitalization of 1.6 billion. Other ginormous coins like Tether (USDT) or Ethereum (ETH), have $ 17,000 and $ 53,000 million respectively. Bitcoin has $ 315 billion.

YFI outperforms Bitcoin for the second time

Despite being an extremely volatile token, due to what has already been mentioned about capitalization, its performance does not cease to surprise. In other words, why does a voting token like YFI outperform none other than Bitcoin itself?

The most remarkable thing about this situation is that it is not the first time that question has been asked. Already the governance token of yearn.finance, has previously exceeded the value of all digital currencies, including Bitcoin.

On September 14 of this year, the value of YFI was above 40 thousand USD, leaving the entire community perplexed. However, on the 17th of that month it had lost about $ 9,000 and on the 21st its value was 23,000. Its lowest point was this November, when it was trading at $ 8,500.

From November 4 to date, YFI’s price has risen again vertically and is now outpacing Bitcoin. At the time of writing, the price of this token is 20,360 USD, while that of Bitcoin is $ 17,300.

The value of YFI again exceeds that of Bitcoin.  While the top cryptocurrency surpassed $ 17,200, YFI is going above $ 20,000.  CoinMarketCap SourceThe value of YFI again exceeds that of Bitcoin.  While the top cryptocurrency surpassed $ 17,200, YFI is going above $ 20,000.  CoinMarketCap SourceThe value of YFI again exceeds that of Bitcoin.  While the top cryptocurrency surpassed $ 17,200, YFI is going above $ 20,000.  CoinMarketCap SourceThe value of YFI again exceeds that of Bitcoin. While the top cryptocurrency surpassed $ 17,200, YFI is getting above $ 20,300. CoinMarketCap Source

Why does this happen?

Among the reasons why the explosive growth of this token can be explained, two could be cited. The first is the functionality of the YFI within Decentralized Finance (DeFi). On the other hand, the limited number of YFI units, which, in a similar dynamic to Bitcoin, the scarcity makes it valuable.

The number of YFIs available is 30,000 units. It is important to be clear about the purpose for which this project was created. It is a governance token whose intention is to function as a voting security within the Yield Farming of the DeFi ecosystem of the Ethereum Blockchain network.

A curious fact related to this token is that its own creator, André Cronje, repeatedly assured that it should not have any value. The reason for this statement is that the function of YFI, as already stated, is to vote.

In simpler words, the YFI token, which today exceeds Bitcoin in value, would in theory only be responsible for making decisions regarding the protocol. The latter refers to the types of interest, commissions and the operation of what is related to the code of the platform.

Part of the DeFi legos

Although the creator of the aforementioned token has indicated that it should have a zero value, in reality something else has happened. YFI has become a fundamental piece of the entire DeFi ecosystem, even, it can just be considered part of the lay of the same.

In this sense, the interoperability of this token with the entire decentralized finance system, together with its scarcity, would be the reasons that push it towards valuation. And such a push, has put YFI above Bitcoin.

One aspect to take into consideration is that the DeFi fever has lost its momentum a couple of months ago. The growth in the prominence of Bitcoin, has moved investors towards the main cryptocurrency.

This recent surge in the price of YFI, could be followed by a sudden drop like the ones it has already had during its short existence.

Data to take into consideration

The functionality with which the YFI governance token was created was to fulfill voting functions. However, its interoperability, as well as its limited offer, began to rapidly inflate its value. The price of the same reached the record of the entire ecosystem last September, when it exceeded USD 40,000. In less than two weeks, its value went from $ 8,500 to $ 20,000.

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