Despite Slow Crypto Market, DeFi Yearn Finance’s YFI gained 7%

While the Crypto industry is gradually recovering from the woes of the crypto winter, DeFi protocol Yearn Finance’s token YFI increased by 7%. The token managed to swim against bearish waves in the last 24 hours. This could be attributed to attempts by investors to capitalize on the supposed rollout of liquid staking derivatives or LSDs.

In the last 48 hours, YFI gained traction against the market leader Bitcoin (BTC) by  23%. At the time of writing, BTC was trading at $22,316.94. And managed to rise by 19% against tether (USDT). At the time of writing, YFI was trading at $10,478.46. At the same time, the Total Value Locked (TVL) at Yearn Finance was $436.95 million. 

Source: Yearn Finance; Defillama.

The reason behind this rally can be attributed to last month’s announcement by the company that Yearn Finance is expanding to liquid staking derivatives. These tokens expose investors to an underlying asset while simultaneously providing staking rewards. This is a part of Ethereum’s Proof-of-Stake (PoS) network. 

Liquid Staking is the exchange of staked ether accumulated by PoS or other staking methods with a tokenized version of ETH. This can be used further in numerous Decentralized Finance (DeFi) applications. Major use cases could be collateral for loans and margin trading for yield earning. 

Yearn Finance announced Liquid Staking Derivatives (LSDs) on February 24, 2023. The stock climbed 39% weekly through Friday soon after the announcement. Trading volumes shot through the roof, rising five times the pre-announcement level. The introduction of the LSD basket was enough to garner the required attention. 

The hype behind the LSD basket can also be referred to the what analysts believe. They think this could expose active investors to multiple underlying tokens, thus simultaneously diversifying their portfolio with better risk management. The tweet also referred to the launch of yETH, also termed LSD of LSDs. 

The Liquid Staking Derivatives (LSD) were priced at $0.7157 with a jump of 32.62% at the time of writing. At the same time, its value against Bitcoin gained massively by 36.64% to 0.00003195 BTC. Also, there was a massive increase in the volume (25.10%) to $249,336.

The effect of the announcement and the buzz it created can be seen on the price chart of YFI. A visible bullish continuation pattern rises above the immediate support zone, slowly moving north to respect the resistance point of $12,406.

Source: YFI/Tether USD; TradingView

If the bullish trend continues, it might touch the R1 and go above $12,500. However, things can turn south anytime given the trademark volatility of the crypto market. Even if that happens, the possibility of it breaking the immediate support zone cleanly is rare. It might consolidate there for a while before bouncing up.  


The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.

Nancy J. Allen
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