Yearn.finance (YFI) On “Life Alert” After Weak Attempt To Hold Support
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”
The popularity in DeFi tokens like Yearn.Finance, LEND, UNI, and several others have been what’s propelled the crypto market back toward profitability and out of the bear market gutter.
The trend has become so dominant in the crypto space, the term “DeFi” now outweighs all mentions of Ethereum in the media by a large margin.
Related Reading | Top Defi Dogs YFI, LEND, and UNI Correct Nearly 20%
ERC-20 tokens even outgrew Ethereum’s market cap when combined, because of how popular and profitable the trend has become. Nearly every new week, another DeFi token turned little investment into a small fortune.
But now, the tides have been turning, and top DeFi dogs have been digging for bones, causing them to fall deeper than anyone would have expected. It has also left YFI on “life alert” according to one crypto trader.
YFIUSDT Yearn.Finance Retesting Support | Source: TradingView
YFI Flying High Could Lead To Dramatic Collapse To Bitcoin Prices
YFI, for example, has tumbled from more than four times the price of a Bitcoin to just $22,000 per token. And while that sounds expensive for any token to beat out Bitcoin in price, its quite a feat.
That achievement alone was enough to cause Yearn.Finance value to skyrocket in its earliest days. But like Bitcoin, it got overheated too quickly and is now pulling back big time.
YFIUSDT finds itself back falling to support previously tested, that its now at risk of losing. If Yearn.Finance loses this support, it could fall back toward Bitcoin prices.
Related Reading | Yearn.Finance (YFI) Flies 15% Percent From Local Price Floor, Fractal Targets $60K+
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