The latest trend in the DeFi sector is a new yield farming protocol called Yam, which promises „equal opportunity“ staking with no rewards, no founder’s actions and a zero value token at launch.
The Yam experimental protocol is the topic of conversation at Crypto Twitter right now, and many are excited about the great potential benefits, while others are concerned about the risks. The recently launched project offers an elastic supply token, similar to Ampleforth’s, which can expand and contract depending on market conditions, with the aim of seeking eventual price stability and a link to the US dollar.
Yield farming increases noise around DeFi, but fundamentals are lagging
Yam will reallocate a ten percent share of each expansion of the offer to buy a high-performance dollar-denominated stablecoin called yCRV in what is known as a „pass. The tokens will be added to the treasury, which is controlled through the Yam community government.
Like Yearn Finance when it launched its native YFI token, the official blog post states that the tokens will be worthless at launch.
„We have built Yam to be a minimally viable monetary experiment, and at launch there will be zero value on the YAM token.
Reasons to tread carefully
After YFI’s monumental achievements, which increased in value by thousands of times, to four-figure prices, some in the crypto community are skeptical that similar tokens will take advantage of advertising. Shapeshift CEO Erik Voorhees – who admits he doesn’t understand how Yam works – wondered if it was a pump and dump scam.
DeFi’s „Yield Farming“ is driving adoption, but stakeholders urge caution
$YAM looks like a scam… or to be more charitable, a clear and transparent meaningless pump and dump operation.
Projects like this aren’t going to be good for defi…
What am I missing? Are the buyers willing participants in a silly game, or are people claiming real value?
– Erik Voorhees (@ErikVoorhees) August 12, 2020
Messari’s investigator, Ryan Watkins, echoed the sentiment. „YAM = Ponzinomics from AMPL + Chad Launch from YFI + Mathematical Memes from Tendies,“ he wrote.
Without awards or token sales, YAM tokens are distributed evenly across eight staking pools in all major DeFi protocols, including COMP, MKR, LEND, YFI, LINK, ETH/AMPL, SNX, and wBTC. Holders of any of these assets can stagger on Yam’s platform to start earning YAM tokens during the first week.