Yearn.Finance Governance Token (AND FI) plummeted more than 43% in just five hours on Nov. 18 after rising nearly 170% earlier in the month, raising fears about a possible exit scam.
During the dramatic drop in value, more than $300 million was wiped out in market capitalization due to November gains. according to data from CoinMarketCap. At the time of writing, the YFI token is trading at $9,069 from $14,185 the previous day. However, the token is still up 83% in the last 30 days.
The sell-off sparked another weekend of fear, uncertainty, and doubt (FUD) within the crypto community. On X (formerly Twitter), some users say that 50% of the token supply was held in 10 developer-controlled wallets. However, Etherscan data suggests that some of these holders may be cryptocurrency exchange wallets.
Additionally, some X users noted that opening short positions may have triggered the move. Coinglass Data sample an increase in YFI open interest, indicating that traders are shorting the coin after November earnings.
"I bought the dip...someone sold 1000 coins, maybe that's why it dropped hugely. We'll see." commented a trader on X. According to another user, YFI's price movement after the crash is unusual for exit scams:
"It doesn't seem like a sudden move at all. Because despite so much selling, the price is still stable at 9k, which is 80% above its minimum."
Yearn.Finance is a decentralized finance (DeFi) protocol that provides automated trading solutions for DeFi markets. Ethereum developer and entrepreneur Andre Cronje launched the protocol in July 2020. Cointelegraph reached out to Cronje and Year.Finance but did not receive an immediate response.
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