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Since a lot are asking for my thoughts about $YFV price, here are the factors that I believe have contributed to the decline from $80 down to current levels (~$5-6) and where I see things headed from here:
A thread
A thread
1) The initial hype of $YFV and the Y protocols in general led to a rapid spike in price during a time where the total supply was still somewhat limited. This led to a run up to $80, which was shortly followed by a lot of profit-taking. Profit taking caused the initial selloff.
2) When the price of a farmed asset is falling, the farmers are incentivized to sell ASAP to recognize the biggest yield. If farmers hold a depreciating asset, they will ultimately make less profit by farming...so we've seen continual selling pressure from farmers from Day 1.
3) Unless there is a motivation to HOLD $YFV, the selling pressure from farming will continue. This typically would be in the form of a staking vault...but returns were initially too low to warrant holding. Farmers still were making more $$ by farm/dump than farm/stake.
4) Once the governance vault opened, there was now another alternative for farmers if they wanted to hold their $YFV tokens. However, the yield (prior to value vaults) was still lower than the farm/dump option. Thus...the selling pressure from all the emissions is still there.
5) As price has continued to drop, more HODLers and believers in the protocol have gotten cold feet and their hands have become weak. They have sold and moved on to greener pastures. Everyone has a breaking point, and 90%+ drawbacks will test even the strongest of hands.
6) The introduction of a second token, $VALUE, has caused a lot of confusion in the community. Many changes have taken place, including a rebalancing/changing of all the farming pools. This forced farmers to withdraw their liquidity. Some transferred to new pools, but not all.
7) As TVL has been dropping due to the overall market dumping, farmers being forced to withdraw liquidity & the farming yields APY% dropping as the value of $YFV has fallen, confidence in the protocol has been waning as well which has caused further sell-off and price decline.
8) That leads us to where we are today. -93% from ATH. I've said this a lot, but price is only an indication of current market sentiment and investor emotions. It does not correspond to true value. It's your job to realize when an asset is overpriced or undervalued.
9) Let's take a step back and look at where the protocol stands:
Farming pools live with multiple, unique assets
Governance staking vault live
Large community and growing (10K on TG)
Max supply reduced
Value vaults live
Value liquid (integral exchange)
- COMING
Farming pools live with multiple, unique assets
Governance staking vault live
Large community and growing (10K on TG)
Max supply reduced
Value vaults live
Value liquid (integral exchange)
- COMING
10) Unbelievable progress in the last 3 weeks for the dev team. With the value vaults now live, I see TVL increasing rapidly in the protocol. TVL is at the heart of revenue generation. This is a huge deal & right now this is not reflected in price.
11) The value vault profit is partially paid to the governance vault stakers. This means that there is now a larger incentive for farmers to STAKE vs farm/dump, which should substantially reduce selling pressure. Farm/stake could soon overtake farm/dump.
12) With the current price at nearly ATL, combined with current development path & speed to market by this incredible dev team...I see an insanely undervalued token right now. Getting these value vaults live is going to provide a major boost to the protocol. I'm still a believer!
