Yearn.Finance Considers Minting New YFI Tokens Worth $225 million
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Yearn.Finance Considers Minting New YFI Tokens Worth $225 million

January 21, 2021      Jafrin Ahmed

The core contributors and the community members of Yearn.finance have submitted a proposal today to increase the supply of YFI with an additional 6666 tokens worth around $225 million at the current price. The proposal includes increasing the supply of YFI tokens by 22%. A third of which will be used to compensate the current and early contributors while the rest will go to the Treasury.

New YFI Tokens to be Minted for Incentivizing Developers

The proposal comes amid debates centering around developer incentives for DeFi projects. For instance, popular DeFi platforms such as Aave (AAVE), Synthetic (SNX), and 1inch (1INCH) have reserved around 20%-30% of token supply for team members and contributors.

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In comparison, Yearn.finance with a $500,000 treasury reserved 0% of the YFI token supply in incentivizing the team during the project’s fair launch liquidity mining event.

The proposal noted:

“Yearn’s launch did not provide adequate incentives to retain existing and future contributors on an ongoing basis, nor did it provide the protocol with a war chest to fund future activities.”

Hence, the proposal, titled Funding Yearn’s Future, calls for the additional mint of 6666 tokens to increase YFI’s current 30,000 token supply by 22%.

A participant in Yearn’s governance forums wrote on Jan. 13:

“Let’s not be Bitcoin. This idea of hard caps for start-ups is very romantic but not necessarily the best execution path for maximal value.”

The token mint proposal aims for evolving the fair launch while safeguarding Yearn.finance’s future development.

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Proposal Likely to be Voted On-Chain

Yearn’s Operations Fund will oversee the Treasury subjected to Yearn’s existing governances. Some of them include future contributor incentives, liquidity mining programs, staking rewards, protocol mergers, and talent acquisitions, as well as cross-protocol incentives to tighten cooperation across the ecosystem family of projects.

Meanwhile, the Compensation Working Group will also be deployed to determine the exact distribution structure of the compensation tokens.

The proposal will likely proceed to be voted on-chain by the end of the week. At the time, YFI is currently trading at $32,322, down from 7% over the last 24 hours.

#DeFi #DeFi Tokens #Ethereum #Governannce Tokens #Yearn.finance #YFI
Jafrin Ahmed
Jafrin Ahmed

Jafrin is a cryptocurrency journalist/researcher fascinated by the world of decentralization. She is hopeful towards blockchain’s innovation and its potential to reshape the world for good. Currently, she is bringing out the best of cryptosphere via covering the latest ins and outs of the blockchain space.