Wintermute Seeks $1.98M YFI Loan from Yearn DAO

Wintermute Trading has approached the Yearn community with a proposal for a 12-month loan of 350 YFI, equivalent to $1.98 million, from the DAO’s treasury. The loan, if sanctioned, would carry a 0.10% interest rate, payable at the term’s conclusion.

As part of their ongoing collaboration with Yearn, Wintermute plans to allocate up to 3M CRV ($1.4M) to purchase yCRV. They will subsequently deploy these assets to the yCRV-CRV Curve pool (lp-yCRV V2) on Yearn for at least 12 months. This initiative aims to rebalance the pool, currently at a 59%/41% yCRV/CRV ratio, enhance the yCRV peg, and augment the pool’s liquidity.

The DeFi sector recently grappled with challenges, notably a bug in certain Vyper versions, leading to a significant liquidity reduction for CRV. This caused concerns within the Aave community due to CRV’s price drop. Wintermute Trading, having been involved in OTC trades across DeFi, now seeks to deploy some CRV tokens on platforms like Yearn.

Established in 2017 by three Optiver veterans, Wintermute Trading is a leading crypto-native algorithmic trading firm. They’ve traded over $3T since their inception, expanding their footprint across 80+ exchanges.

The borrowed YFI will be strictly used for trading. Wintermute also intends to deploy yCRV tokens to the yCRV-CRV pool on Yearn for a minimum of 12 months. A 3/4 multisig will be set up, ensuring transactions require at least one signature from a Yearn contributor.

At the 12-month term’s end, Wintermute commits to returning the full 350 YFI loan amount with the 0.10% interest to the DAO’s treasury. If the Yearn DAO greenlights the proposal, the 350 YFI will be transferred to Wintermute’s specified address, followed by the establishment of a 3/4 multisig.

The Yearn community now faces a pivotal decision: to approve or decline Wintermute’s proposal.

Image source: Shutterstock


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Yearn Finance Creator To Launch New AMM, What It’s All About?

Famous for his motto “I test in prod”, Andre Cronje, inventor of Yearn Finance and other DeFi protocols, will launch a new platform. Called ve(3,3) it has been designed as an Automated Market Maker (AMM) to operate with a “protocol for protocols” architecture.

Related Reading | Solana DeFi Goes Stratospheric as Hubble Protocol Announces $3.6M Raise

In other words, this new AMM will be easy to integrate with other platforms to incentivize their own liquidity and without tradeoffs. The protocols that decide to add ve(3,3) won’t lose fees, volumes, or liquidity, as the creator of Yearn Finance explained in an official post.

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Cronje believes AMMs utility has undergone a change, from primarily serving as a tool for liquidity providers to serving as an addition to projects. Thus, ve(3,3) seeks to meet the demand of AMM’s new users; other protocols.

His new project, ve(3,3), will remove friction from the process of adding token incentives to a protocol’s liquidity, will make it simpler for projects to accrue fees from incentives, and will operate as a permissionless platform. The Yearn Finance developer said:

With the above in place, any protocol or project can easily incentivize their own liquidity, be it for their token, their stable coin, or even other derivatives, and while doing so, they fully accrue fees.

Cronje’s new protocol will have multiple features, including the capacity to natively support swaps between closely correlated assets, and uncorrelated assets, Uniswap v2 compatibility which will let projects deploy its interface, the possibility to permissionless create pools, gauges, and bribes.

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In addition, the protocol will operate with a 0.01% fee to be paid in base assets. Cronje’s protocol for protocols will let other platforms support delegation, increase “holdings proportional to emission”, and conduct locks with capital efficiency, amongst many other features.

Yearn Finance Inventor To Take AMM Utility To Its Next Phase?

As an additional incentive for projects to implement Cronje’s protocol, the platform will reward them with ve(3,3) tokens. Those projects that occupy the top 20 by total value locked (TVL) will receive these rewards two weeks after the protocol launches.

The launch could take place next week, as Cronje announced via Twitter. By the end of next week, the platform will take a snapshot to determine the projects that will receive a percentage of the 2,000,000 ve(3,3) available for rewards. Cronje added:

It is up to them (the selected projects) to decide what they will incentivize, be it their own token, stable coin, or other liquidity. The timeline for this will thus be 2 weeks post protocol launch until distribution starts.

As of press time, Yearn Finance native token YFI trades at $32,139 with a 2.7% profit in 24-hours.

Related Reading | Yearn Finance Launches New Vault, While YFI Retakes Bullish Momemtum

YFI Yearn Finance YFIUSDT
YFI moving sideways in the 4-hour chart. Source: YFIUSDT Tradingview


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Yearn Finance risks pullback after YFI price gains 100% in less than 3 weeks

Yearn Finance (YFI) looks poised for a price correction after rising five days in a row to approach $42,000. Notably, an absence of enough buying volume coupled with overbought risks is behind the bearish outlook.

The YFI price rally so far

YFI price surged by a little over 47% in five days to $41,970 as traders rotated capital out of “top-cap” cryptocurrencies like Bitcoin (BTC) and Ether (ETH) and looked for short-term opportunities in the altcoin market.

Yearn Finance was among the beneficiaries of the so-called capital migration, given its value against BTC and ETH rose almost 47% and 41.50% in just five days. Meanwhile, at the core of traders’ sudden buying interest in the YFI markets was a token buyback program.

YFI/ETH and YFI/BTC daily price performance after token buyback program announcement. Source: TradingView

On Dec. 16, the Yearn Finance team announced that they had purchased more than $7.5 million worth of YFI tokens from the open market at an average price of $26,651 per unit. They also revealed $45 million extra cash in their Treasury that they would use to continue their YFI buyback spree.

Additionally, the Yearn Finance community also proposed that the YFI treasury direct a portion of the token buyback to reward YFI holders who actively participate in Yearn Governance. The proposal (full details here) is currently in its voting phase.

YFI price surged by more than 100% against the U.S. dollar after the token buyback announcement.

YFI price correction risks

However, YFI trading volume fell despite the rall, suggesting the low conviction among traders in its upward movement.

YFI/USD daily price chart featuring price-volume divergence. Source: TradingView

Typically, a bearish divergence between price and volume leads to either correction or consolidation till conviction increases. As a result, the likelihood of YFI at least pausing its ongoing price rally is high, with its daily relative strength index (RSI) also entering its overbought zone above 70, a sell signal.

Related: YFI price gains 46% in just four days after Yearn Finance’s $7.5M buyback

Additionally, the Yearn Finance token’s latest price rally has brought it closer to a known inflection zone near $40,000, as shown via the Fibonacci retracement graph in the chart below.

YFI/USD three-day price chart featuring Fib entry and exit levels. Source: TradingView

In detail, the 0.618 Fib line near $40,113 has been limiting YFI’s upside attempts intraday. The same level was instrumental in stopping the Yearn Finance token’s price rally between October and November, which later led the YFI price to its 12-month low near $17,000.

Nonetheless, if the bulls manage to push the YFI price above the 0.618 line decisively, they may also take the token out of its multi-month range defined by circa $25,500 as support and $40,000 as resistance. In that scenario, YFI’s next upside target may move towards the 0.5 Fib line around $51,000.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risk, you should conduct your own research when making a decision.