Yearn.finance (YFI) price prediction: What is YFI?

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Can YFI attract more people to the decentralised finance practice of yield farming?

Yearn.finance logo on a smartphone screen                                 
YFI has been doing some things that its creators did not intend – Photo: Shutterstock
                                

Contents

In the world of crypto, yield farming can be a high-risk and high-reward strategy. Enter Yearn.finance, which aims to make it simpler.

But what is Yearn.finance (YFI)? What is the Yearn.finance price prediction? Let’s see if we can find out. 

YFI explained

One of the concepts that helps people to make money from cryptocurrency trading is yield farming. This allows people who are involved in decentralised finance (DeFi) to make money.

Yield farming is, according to CoinMarketCap “the practice of staking or lending crypto assets in order to generate high returns or rewards in the form of additional cryptocurrency”. In other words, it involves moving a crypto around different marketplaces in an attempt to generate a good turnover of interest. 

The thing with yield farming is that it can be pretty complex, not to mention potentially expensive if you do not move your crypto to the right platform. This is where Yearn.finance comes in. The system is designed to automate the process of finding marketplaces with the best yield across DeFi platforms.

It was originally launched in early 2020, with the system’s native token, YFI, coming onto the market in the summer of that year. The coin had what is called a “fair launch”, meaning there was no kind of pre-sale or initial coin offering (ICO).

As for the YFI token itself, it’s best explained by the system’s founder, Andre Cronje, who at the time it came out wrote: “Earning YFI is simple, provide liquidity to one of the platforms above, stake the output tokens in the distribution contracts (we will provide an interface for this), and you will earn a (governance controlled) amount per day.

“Otherwise, standard voting rules apply, minimum quorum required (>33%) to propose a change, usual veto rights (>25%), and usual agreement thresholds (>50%) required to pass a vote and update a change. All these are configurable, governance can feel free to change as required.”

What is notable about the YFI token is that when it launched, Cronje described it as “a completely valueless 0 supply token. We reiterate, it has 0 financial value. There is no pre-mine, there is no sale, no you cannot buy it, no, it won’t be on Uniswap, no, there won’t be an auction. We don’t have any of it.”

However, it was not long before the token, which operates on the Ethereum blockchain, was being traded on Uniswap and other decentralised exchanges, meaning that this particular part of the plan did not work out as well as had been intended.

YFI price history

Now it’s time to examine the YFI price history. While past performance is never any indicator of future results, knowing how the token has behaved previously can be helpful when it comes to both making and interpreting a Yearn.finance price prediction.

When YFI came onto the open market in July 2020, it was worth around $900. It did not take long before it topped $1,000, and, by the end of August, it had skyrocketed to more than $30,000. The growth did not stop there and on 12 September 2020 the token was trading at more than $40,000. There were signs of volatility, though, and the price dropped below $10,000 in early November, before recovering to close the year at $22,738.15. 

Early 2021 was a real boom time for cryptocurrency as a whole – and YFI joined in the action, breaking again through the $40,000 barrier in February before settling down to trade in the $30,000-$39,000 zone in March. April was another month of growth, with the token exceeding $50,000 with an intraday high of $53,176.03 on 15 April 2021, leading to another of $57,174.35 on 19 April. There were more peaks and troughs, but in early May the coin exploded, reaching an all-time high of $93,435.53 on 12 May 2021.

The great crypto day crash of 19 May 2021 burst the bubble somewhat, though, and it closed the month at $47,020.89. The summer was a poor time for crypto and the token reached a periodic low of $24,864.90 on 20 July. August saw YFI recover as the market improved and it was consistently above $30,000 for much of the month. 

However, while September started well with YFI trading at more than $40,000, bearishness in the market saw the price fall to a low of $26,659.71 on 21 September 2021. 

Line chart showing the rise and fall in the price of YFI from before October 2021 until early 2022
YFI price history – Credit: Currency.com

October 2021 was a time of recovery, with YFI closing the month at $34,078.38, while November saw consistency over $30,000 at the start of the month, with a periodic high of $36,408.53 on 8 November before the market slumped due to concerns about the Omicron variant of Covid-19.

The decline was not over, and on 15 December it fell to $18,894.03 – nearly half of what it had been worth a little over a month previously. YFI then recovered to close 2021 at $32,947.72.

January 2022 saw an initial bull run, with Yearn.finance reaching $41,470.28 on 3 January, before a market slump saw it close the month at $24,806.55. February initially saw the token go up, but then it dropped to around $20,000 before market uncertainty surrounding Russia’s invasion of Ukraine saw it dip to an intraday low of $17,217.30 on 24 February.

After multiple market crashes in mid-May and mid-June, the token continued on a downward trajectory. In an effort to ease the collective minds of YFI investors, Yearn.finance posted the following on Twitter: 

YFI sank to lows of $4,069.14 on 18 June. However, the token gained some momentum in the following days and weeks and as of 26 July 2022, there are 36,637.72 YFI in circulation out of a total supply of 36,666.

Yearn.finance’s market cap is $242m, making it the 110th-largest cryptocurrency by that metric.

YFI price prediction

Now let’s take a look at some Yearn.finance price predictions. At this point, we need to remember that long-term forecasts, especially when it comes to something as volatile as cryptocurrency, are very often wrong. Additionally, longer-term crypto predictions are often made using an algorithm, which can change at any time. 

First, CryptoNewsZ has a Yearn.finance price prediction for 2022 that says that the coin could reach $28,910.64. In 2023, the coin should get to $34,766.18, while there should be more growth before its advance stalls somewhat in 2024, when the YFI price should get to $35,368.05. There should be no holding back in 2025, with the price reaching $45,829.36. The bears should then come to the market in 2026, when YFI will be worth $41,683.07. 

Second, PricePrediction.net argues that YFI can get to an average of $13,173.84 this year before it goes up to $18,772.15 in 2023. There will be more growth in 2024 when the coin reaches $26,749.52, and the site argues that the crypto can get to $40,799.45 in 2025 before passing $58,712.99 in 2026.

The site’s forecast puts Yearn.finance at $86,976.59 in 2027, $123,926.25 in 2028 and $181,817.37 in 2029. There is a Yearn.finance price prediction for 2030 of $271,931 before the price continues to rise, to reach $398,961.32 in 2031.

Meanwhile, LongForecast says that the coin should plummet to a closing price of $3,470 by the end of the year, then close July 2023 at $2,835 and recover slightly to hit $2,969 as the closing price for December that year. Things should recover, though, and in July 2024 it should close at $5,930 while 12 months from then the coin should close that same month at $4,418 before closing July 2026 at $6,899.

Finally, DigitalCoinPrice remains somewhat optimistic, saying that YFI should be worth an average of $8,455.92 in 2022 before going up to $9,752.28 in 2023. The site’s Yearn.finance price prediction for 2025 comes in at $12,771.09.

There will be a downturn the following year, however, with YFI falling to $11,704.32, but 2027 should see a significant recovery to $14,886.15 before it shoots up to $20,353.11 in 2028 and $26,662.53 in 2029. In 2030, YFI will reach $30,162.82, and it should continue its rise to hit an average price of $33,576.73 in 2031. 

Final thoughts

A few final things to point out.

First, the fact is that the token was designed to be earned, rather than traded. This means that, right out of the gate, YFI was not doing what its creators wanted it to do.

Second, while the token’s price is high, that has more to do with its scarcity than its actual value per se.

Third, the world of yield farming is, in and of itself, a risky business. While Yearn.finance may well make things easier for people, there is not a great take-up of it compared with regular crypto trading.

As always, it pays to be careful when it comes to investing in any crypto, so make sure you do your own research before going in on YFI.

FAQs

As of 26 July 2022, there were 36,637.72 YFI in circulation out of a total supply of 36,666.

It can be argued, at least by proponents of buying during dips, that now might be a good time to invest in YFI. That said, some caution is needed. We have seen the price of YFI go down quite a bit over the last 12 months.

Remember, cryptocurrencies can be highly volatile and prices can go down as well as up. You will need to do your own research and never invest more than you can afford to lose.

Now might be a good time to invest in YFI if you are a supporter of buying during dips. Having said that, it may pay to be more cautious. Over the last 12 months, the YFI price has fallen quite considerably.

Cryptos can be highly volatile and prices go down as well as rise. Do your own research and never invest more money than you can afford to lose. 

Supporters of buying during the dip might well tell you that cryptos like YFI, which has lost value over the last 12 months, are worth looking into. On the other hand, it has been in a bearish place for some time now.

Regardless, you will need to remember that cryptocurrencies can be highly volatile and prices can go down as well as up. You will need to carry out your own research and never invest more than you can afford to lose.

Further reading

The material provided on this website is for information purposes only and should not be regarded as investment research or investment advice. Any opinion that may be provided on this page is a subjective point of view of the author and does not constitute a recommendation by Currency Com Bel LLC or its partners. We do not make any endorsements or warranty on the accuracy or completeness of the information that is provided on this page. By relying on the information on this page, you acknowledge that you are acting knowingly and independently and that you accept all the risks involved.
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