YAM Developers Reveal Bug in Rebase Contract

Cornelia Mascio
Agosto 16, 2020

However, the team behind it announced the project's second version.

YAM Finance, the latest yield farming sensation, witnessed a bug in the rebase mechanism.

As for what happens to YAM now, the team said that "YAM will live on as long as Ethereum continues to operate with support for the contract as written".

Total value locked in YAM surpassed Dollars 600 million in less than two days since its launch, dropping to USD 281 million now (10:02 UTC). If the price of goes below $1, the supply is decreased until the price parity has been restored.

Things went wrong for the project, however, after a bug in its smart contract was found affecting the rebasing contract.

However, Coingecko.com data now shows that after the second rebase this morning, the YAM market capitalization dropped from Dollars 63m to zero.

The Yam protocol became instant famous and had surpassed around $500 million in total value locked (TVL) at one point. "This growth was possible because of the fact that the protocol allowed multiple very popular tokens to be staked to earn YAM".

But it was soon faced with its potential demise when on August 12 the seemingly anonymous team behind it uncovered a code bug which would've led to more YAM's being released than expected through the rebase system, making the treasury ungovernable and funds lost.

This was followed with the team's call to YAM farmers to "SAVE YAM!". For it to be successful, in a matter of hours, YAM 160,000 were needed to be delegated via yam finance, the governance proposal submitted, and then finally executed.

The market capitalization of YAM has plunged to just about $19.5 million at the time of writing from $475 million about one hour ago.

"We are urgently investigating a potential flaw.We strongly advise exiting the Uniswap YAM/yCRV pool prior to rebase at 8am UTC (35 mins)", Yam.Finance tweeted today. yCRV is a basket of yield-generating stablecoins on the Curve protocol.

In a follow-up tweet, the project stated that the yCRV, a collateral token that was accumulated in reserve during rebase, stands the chance of being stuck if the governance can not pass proposals.

Similar to Ampleforth protocol's AMPL token, Yam protocol's YAM token is price elastic, meaning its supply is adjusted based on price movement.

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