- A new token locked up nearly half a billion in value just hours after starting trading.
- KIMCHI is a fork of SUSHI.
- The project proclaims that it "could be the next hot DeFi farming token."
If you haven’t heard of KIMCHI, the DeFi farming token, that’s because it didn’t exist yesterday. Today, it reportedly locked in $500 million in value from staking before tumbling down to a mere, ahem, $150 million or so.
Its growth trajectory mirrors other recent DeFi projects, notably Yam, the token that surged past $150 in just a couple days before crashing down to $0 like a not-so-sweet potato within just 48 hours.
KIMCHI Token is a fork of Yuno and Sushi, the latter of which is itself a fork of Uniswap.
KIMCHI is new enough that it’s hard to ascertain how exactly it differs from its mother token, SUSHI. Sushiswap issues the eponymous SUSHI tokens as a way of incentivizing people to contribute liquidity to the platform.
The platform also gives a cut of the trading fees to users who lock their tokens into a smart contract, meaning they can’t touch it for a specified period.
KIMCHI apparently lets users farm ETH, SUSHI, TEND, USDT, or Uniswap assets in the hopes that they’ll earn obscenely high interest (up to 66,000 APY, according to the platform), for generating liquidity for the platform. The KIMCHI token market cap is currently north of $44 million since becoming available today.
Just this past weekend, the total value locked in Defi applications hit $8 billion, meaning there’s a huge appetite for people looking to generate income from their cryptocurrency holdings. It’s also clear that people are willing to run headlong into new protocols with little information to go on.
It should go without saying that using the KIMCHI protocol, which operates using an unaudited smart contract, is a highly risky investment decision.
And the About page for KIMCHI FINANCE doesn’t shed much light on the operation beyond saying, “KIMCHI could be the next hot DeFi farming token. Who knows?!”
More inquisitive users can look under the hood at the token contract, but they have to be able to understand it. Part of the appeal of these tokens is seemingly the, erm, fun of getting in fast on the next hot thing before it's proven too good to be true.
It's kind of like playing a game of hot...yam. Only with millions of dollars at stake.
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.