Crypto fund Polychain Capital picked up another 141 YFI, in a move yesterday that expanded its investment in the decentralized finance (DeFi) protocol. The company purchased 329 YFI just last week, according to Messari researcher Mason Nystrom, decided to double up recently.
YFI has become one of the fastest-growing cryptocurrencies of all time, coupled with the Yearn Finance protocol’s utility for applications ranging from token swaps and automated wealth management to credit lending and lending.
YFI’s Quick Rise
At its launch in July, YFI went from around $30 (excluding free distribution to some early yEarn users) to upwards of $42,000 in September, a 55,295% increase as per CoinGecko price tracker info.
Today, contributors to Yearn Finance, one of the early and most progressive decentralized government developments, released a manifesto outlining the unique nature of the DeFi protocol.
But while the sky-high prices did not last long, they dropped almost 80 percent after YFI ‘s height, crypto funds including Polychain Capital have been making movements. The fund picked up a total of 470 YFI this month alone, with its investment valued over $8.2 million.
Polychain Capital is one of the token’s key holders currently. This is due to YFI’s limited supply restriction of just 30,000 tokens. The fund will now boast that 1.6 percent of the overall supply is regulated by it, all obtained from the free market.
Yearn Finance has emerged as the quintessential DeFi project in recent months, with the token possessing no pre-sale to venture capital firms or buyers, and its maker, Andre Cronje, holding no tokens. This added to a positive narrative for the token in crypto circles.
The DeFi token has had a rough few weeks after posting an all-time high of $43,873 on the 12th of September in the case of Yearn Finance (YFI). YFI started to lose value from the record-breaking day and recorded a local low of $7,450 on the 5th of November.
Two days later, and on 7 November, the transaction count for Yearn Finance surpassed a fresh all-time peak of 11,3000. The team at CoinMetrics caught this case, clarifying that the elevated YFI behavior may be an indication of a revival of DeFi.
The History of Polychain Capital
Venture capitalists Andreessen Horowitz, Sequoia Capital, Founders Fund and Union Square Ventures include some of the biggest participants in Polychain Capital.
The first venture fund of Polychain divided its investments into startups that improved infrastructural solutions for blockchain and those that pursued creative new innovations in the crypto industry.
Cryptocurrency exchanges and custodians were therefore prioritized by the fund, with Coinbase being a flagship investment.
Polychain has already traded in digital currency and established its own crypto hedge fund in 2016, according to Coindesk. This hedge fund invests in digital properties for short and long term positions. As of October 2019, it had an AUM of around $550 million.
The fund supported DeFi (decentralized finance) institutions in its second, more novel category. Those included MakerDAO, dYdX margin trading book, Dharma blockchain bank and Compound loan protocol.
The second Polychain fund will aim for ways to invest in blockchain networks with enhanced capabilities of anonymity, engineering and flexibility.