The original food-themed clone protocol of the decentralized finance (DeFi) sector, Yam, has completed their first rebase successfully since its V3 relaunch. Yam V2 was a spectacular failure that happened last month because governance was rendered impossible because of a bug in the unaudited code of the protocol. This happened within two days by rebasing the supply of the token 10 times higher than it was intended by its design. Therefore, Yam was relaunched on September 18th. The Yearn.finance style protocol has defined itself to be a kind of experiment in governance, fair farming, and elasticity.
Yam is looking to maintain a peg of 1 yUSD per token through ‘rebasing’ or adjusting its supply after every 12 hours. No rebase will happen if Yam’s price is between $0.95 and $1.05 yUSD. The first rebase of Yam’s V3 took place on 21st September and it added an approximate $571,000 worth of yUSD to its treasury. It also ended up expanding the YAM positions of all token holders by nearly 2.49 times and this prompted the price of YAM to fall from $20 to $7. Even after the rebase, Yam stated that their protocol is still not fully optimized as yet.
The company noted that even though V3 retained most of the parameters seen in V1 related to creating an efficient audit and governance process. But, it said that improvements still had to be made to the liquidity incentivization, governance, and rebasing processes that are behind the protocol. The company said that rebasing should be executed with greater frequency in the future for reducing the market impact of purchases made by their treasury. In the coming days, on-chain governance will go live and so, Yam developers are hoping to introduce on-chain analytics, make improvements to their Uniswap routing, along with extensive documentation in the near future.
Yam is also hoping to provide community contributors with greater rewards, which includes community moderators, core developers, and infrastructure contributors.