Decentralized Finance (DeFi) protocol Yearn.Finance is advancing in its season of mergers with the latest announcement coming in to feature another DeFi notable DeFi giant SushiSwap.
As reported by The Block, the merger between Yearn.Finance and SushiSwap is the former’s fifth merger and showcases the protocol’s effort to keep bringing in value into the DeFi ecosystem.
The decentralized finance ecosystem is already seeing impressive momentum as DeFi protocols dedicated to lending and borrowing, cryptocurrency swapping, and other decentralized finance offerings permeate the cryptospace. With the advances shown as marked by the embrace of the products by people, the move to bring in the mergers of different protocols may further help to accelerate the mainstream adoption and growth of crypto.
The merger between Yearn.Finance and SushiSwap will see both protocols combine their Total Value Locked (TVL) as well as each other’s development resources. The Total Value Locked in Yearn.Finance is $453.7 million according to DeFi Pulse while that of SushiSwap comes in at $735.7 million. This makes SushiSwap the biggest mergers of Yearn.Finance to date.
Andre Cronje, Yearn Finance founder, said:
“As Sushi focused on expanding their AMM [automated market maker] ecosystem, and as Yearn focused on expanding their strategies, more and more overlap became apparent, Yearn needed custom AMM experiences for their strategies, and Sushi started pushing the boundaries of yield and money markets. With these overlaps, more and more work started to become mutualistic, and at this point, it makes to take the relationship to the next level.”
With the mergers, DeFi observers are awaiting what the impacts will be on both protocols in terms of the change in Total value locked, and governance token price amongst others. Cronje also stated:
“Yearn will participate in Sushi governance and add to its treasury some SUSHI. SushiSwap will participate and add to its treasury YFI.”
The SushiSwap protocol will lend the necessary support to help Yearn.Finance to develop its proposed DeFi project dubbed DeriSwap, a DeFi protocol that is set to serve as the one-stop center for products such as loans, swaps, and options.
Yearn.Finance Merger, Possible Bullish Twist for SushiSwap
The partnership between both defi outfits has more advantages than is being visible at first glance. SushiSwap though relatively new had such a meteoric rise that pumped the value of its governance token price significantly high within days of the protocol’s launch.
Upon realizing the surge, SushiSwap’s core developer Chef Nomi pulled out his stakes and cashed out in form of Ethereum (ETH) and the entire fiasco sent shock ways down to the SushiSwap community causing an unprecedented drop in the token price.
While SushiSwap has allayed the fears of its community by ensuring it transferred the network’s development to FTX Derivatives Exchange Founder and Chief Executive Officer, Sam Bankman-Fried and everything seems to be back to normal, the latest merger will also serve in helping to rebuild the protocol’s image.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.