What happens if you mix esoteric financial instruments with bad coding practices? You get decentralized finance (DeFi), a new buzzword popular with crypto fans who see it as a way to invest in new startups or put money to work by lending dormant crypto to eager customers.
The latest in DeFi hilarity comes to us in the form of the YAM token, a cryptocurrency that was originally designed to do nothing and be completely worthless.
What that means in practice is pretty funny. The YAM, aannounced in a medium post by founder Brock Elmore, should be a “minimally viable monetary experiment”, and parrot the concept of the minimally viable product in the start-up world. The MVP is a product that works—mar amper—and is used to test vital product brand. In this case, however, there was no vital product market.
“After the deployment, it is entirely up to YAM holders to determine their value and future development,” he said. This means that Elmore expected the YAM owners—as investors—to come up with projects to fund with the platform.
Elmore posted the first mention of YAM on Medium on August 11th. The token went on sale, and smart crypto investors pushed the price up to nearly $ 180 on August 12, giving the project a direct $ 460 million market cap.
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A few hours after his full time The project leaders issued a stern warning: “SAVE YAM! 🍠‘They said the developers accidentally inserted a bug into the system that’ minted ‘too many dying cryptocurrencies, resulting in a glut that no one would allow—not the makers and not the YAM “investors” –to check the platform. She wrote:
If government is unable to submit a bug-fix proposal prior to the second rebase, no further administrative action will be possible as so many YAMs will be kept in reserve that it will be impossible for proposals to reach quorum . If this happens, YAM’s treasury will become ungovernable and these funds will be lost.
By August 13, the entire market cap fell to near zero, because the only exchange that supported these YAMs, they stopped selling. The exchange, Gate.io, has since re-established the YAM, but it does not look good for YAMsters.
The YAM is currently trading at around $ 1 with many users trying to drop their bags of YAMs on the open market. For his part, Elmore followed the advice of Kenny Rogers and decided to comply.
The world of cryptocurrency responded with amusement.
‘What a wild ride. Of absolute glory and anyone who gets rich to wreck all in less than 48 hours. It was a crazy experiment, and demonstrates the importance of competent coders, ”one wrote Edit users. Others saw the hand of vulture in the downfall of the YAM.
“It’s become extremely fast from Defi nerd FOMO and died then when they found a break in the unaudited, complex smart contract that could not be repaired,” said Adam Levine, host of LetsTalkBitcoin. He compares the excitement to 2017 when crypto projects were launched (and fail) almost as hard as this noble tuber did.
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