yearn.finance Community Finalizes the Inflation of Token Supply by 20%
The yearn.finance community has voted to mint 6,666 YFIs, which was with one-thirds allocated to key platform contributors and two-thirds to the Treasury. The minted YFI, which is to be placed on the Treasury, will be under the control of the community as well. According to the vote, the move is intended to provide community contributors with incentives for participation, as well as increase the reserves of the protocol in order to finance future activities.
The Vote to Mint New YFI for Yearn’s Future
The vote can be found under the proposal titled “YIP-57: Funding Yearn’s Future.”
There are several motivations for the proposal. The first is to sustain the growth of the community and the platform. According to the team who submitted the proposal, this will ensure that the launch becomes more of a living concept rather than a single event.
Another motivation is to balance out the competitive disadvantage of the protocol against other DeFi projects with the same goal, such as 1inch, Aave, Balancer, and Uniswap, among others. In the aforementioned projects, there are bigger token allocations for its community and early contributors.
Who Voted For the Proposal?
The proposal to mint new YFIs gathered 1,670 votes against 331. The total amount that was staked for the vote was 4,089 YFI.
There are some individuals from the community who voted in support of the proposal who thought that the move seems to be equivalent to an equity raising round. According to zkwaffles,
“I am supportive of this proposal, assuming raised funds will be allocated effectively going forward. To an extent, this falls on the community to use the treasury wisely in the future.”
However, it did not go unopposed. Some of the voters, like TangKM, likened the move to what the US government is doing with the US dollar. Furthermore, there are some worries that the power of the developers on the platform might go unchecked eventually.
How the minting will affect the valuation of YFI, however, is something that remains to be seen. We’ve observed time and again that predicting the value of a token is difficult. For now, the community is looking forward to what the next steps would be after the amendment to the protocol is executed.