HiFi Finance price jumps 70% after NFT security status update
2023-04-21 04:06:06 ET
The HiFi Finance price has surprised a majority of crypto traders today after jumping 70% at press time and still going strong. HIFI, the initial token of the HiFi Finance decentralized finance protocol, is among today’s top gainers as the global crypto market capitalization is down 2.97%.
The main reason for today’s HIFI price increase is the NFT security status update that HiFi Finance made today.
What is HiFi Finance?
For those coming across HiFi Finance for the first time, it is a DeFi protocol that allows users to lend and borrow cryptocurrencies at a fixed rate. It was originally known as Mainframe when it launched in 2017. Mainframe began as a decentralized communications layer for Web3 before transitioning to Decentralized Finance and changing to HiFi in early 2020.
It uses an Automated Market Maker model (AMM) where users supply tokens to liquidity pools and then an algorithm sets the interest rate based on supply and demand.
The liquidity providers who supply liquidity (tokens) to the liquidity pools earn rewards while enabling peer-to-peer (P2P) lending and borrowing.
In addition to providing liquidity, borrowing and lending, users can also participate in HiFi Governance where users use the HIFI token to vote on proposals by staking the token. The delegates’ voting rights are adjusted automatically depending on how many HIFI tokens have been deposited.
HiFi Finance NFT Security Status Update
HiFi Finance recently announced that they are working on enabling NFTs as collateral, and today’s post on their website highlighted how far along they are with their project to allow users to borrow against NFTs.
In the blog post, the HiFi Finance team states:
“Our latest blog post introduces Pooled NFT v2 and discusses how it solves the deadlocked NFTs in the current version. V2 will add permissions and manage this edge elegantly. Our team can remove the last NFT, sell it and spread the proceeds to the pool token -the holders’ pro-rata.”
However, they went on to state that while it was technically possible to allow loans against NFTs at the moment, they have “chose to wait until the new version of Pooled NFT goes live before doing so.”
They also said they “wish to avoid creating additional incentives to add pools to v1 of Pooled NFTs. In addition, handling an active loan migration unnecessarily divides liquidity and overcomplicates the upgrade and migration process for pooled NFTs.”
Once the team is done with the smart contract and front-end work, they will proceed with a proposal to add merged NFTs as collateral for the delegates to vote.
The post HiFi Finance price jumps 70% after NFT security status update first appeared on Invezz.
