CORE: the Ethereum token that surged 4,000%, then crashed—all in one day
Quite many people are looking forward to repeating success, becoming a project “the next YFI.” And that’s the story of CORE – the Ethereum token that surged 4,000%, then crashed — all in one day.
Chart of CORE’s price action since launch | Source: TradingView
What is CORE?
Over recent weeks, DeFi yield farming has started to lose steam. Due to yield farming becoming crowded with countless retail participants and even crypto funds getting involved, have dried up, also forcing the prices of farmable coins like Curve DAO Token, SushiSwap, and others lower. Along with yield farming becoming a crowded trade, there is also an issue with the underlying tokens. They are inflationary, meaning users are incentivized to farm and then dump these tokens as soon as possible. Not to mention, unless there is good buy orders or exit liquidity, these sales are often met with little resistance.
CORE Vault, or cVault Finance, is a new DeFi project attempting to shift paradigms in the yield farming space. This is a non-inflationary yield farming project where the yield offered on deposits are generated through autonomous yield-farming strategies, such as using capital to farm CRV.
CORE immediately reached a market cap of $ 40 million within 24 hours of launch. The problem is, after it hit this feat, it fell more than 70%.
CORE managed to garner a $ 40 million market capitalization under 24 hours after it launched
A hard-capped 10,000 tokens were distributed in the token’s pre-sale event, which raised over $ 1,000,000, giving the coin a starting price of approximately $ 100. The idea with this non-inflationary is to drive buying pressure higher over time, where there is always some capital enclosed in the system to drive value to CORE holders and yield farmers of the project. While complicated, the project quickly got noticed as famous Twitter traders started discussing the token.
Just about 12 hours after the start of trading, CORE hit a market cap of $ 40 million when it temporarily hit a price tag of $ 4,000 – nearly 4,000 percent higher than its starting price. It has continued to fall by more than 70% even though the project still has a market cap of more than $ 10 million 24 hours after launch.
While much of the increase mentioned above has been re-examined, this absurd price action reinforces the fact that speculation remains in the DeFi space despite the recent weakening of prices.
Ari Paul, the founder of BlockTower Capital, commented on the presence of speculation on the DeFi market earlier this month as follows:
Qiao Wang, a well-known DeFi analyst, also commented on this in a recent interview with Amber Group’s Leslie Lamb.
Right now, the ethereum advantage is composability. Defi is a token speculation casino and most of the tokens people want to bet on are ERC20. Interoperability, wrapped coins, and DEXs like serum may erode/eliminate that edge fairly soon, but not yet.
— Ari Paul ⛓️ (@AriDavidPaul) September 11, 2020
“Unfortunately, all of DeFi right now is a zero-sum game where tokens intrinsically have no value, meaning the way to make a profit in the industry is to ensure someone else takes losses or fewer profits effectively.”
The way DeFi creates a positive environment where everyone can share growth remains to be seen.
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