ETHFI token has experienced a remarkable surge of 150% in price this week, leaving investors wondering about the reasons behind this sharp rise. According to Matheus Guelfi, co-founder of Modular Crypto, there are several factors contributing to ETHFI’s recent success.
Firstly, Guelfi points out that only around 12% of ETHFI’s total supply is currently circulating. This scarcity of available tokens has created a sense of anticipation and potential for higher valuation among token holders, driving up demand. Additionally, a significant portion of the token recipients are still in the vesting period, holding onto their tokens instead of immediately selling them.
Another factor influencing the price surge is the “value accruing” mechanism introduced by EtherFi, the platform behind ETHFI. This mechanism promises improved ranking for ETHFI holders in the StakeRank protocol, and rumors are circulating about the possibility of a staking program and revenue sharing. These potential benefits have sparked further interest and investment in ETHFI.
In terms of fundamentals, Guelfi highlights the reputation and innovative approach of the EtherFi team, positioning them favorably in the rapidly growing restaking market. Compared to other staking protocols, EtherFi has witnessed significant inflows of over 800,000 ETH in the past six months, second only to Lido. Investors are attracted to the potential for higher yields through restaking compared to traditional staking methods, which positions EtherFi for continued growth and market expansion.
Overall, the combination of limited token supply, the value accruing mechanism, and positive market sentiment towards the innovative approach of EtherFi has contributed to the impressive price surge of ETHFI in recent days.