"YFI" and "LRC" listed, "Coinbase Effect" reemerges! Executive reveals plans to launch an IEO platform

With Coinbase announcing the opening of the top DeFi protocol Yearn.finance (YFI) and the trading market for the decentralized exchange protocol Loopring (LRC) on September 15th, both projects surged by over 10%. Coinbase also recently revealed that it may soon launch an Initial Exchange Offering (IEO) platform.

The Coinbase Effect Resurfaces

According to an announcement by Coinbase on the 11th, the exchange will open token deposits on the 14th and start trading on the 15th. As reported before, the "Coinbase Effect" dictates that projects selected after their coin listing announcement usually experience a certain increase in value. This has held true for LRC and YFI as well, and interestingly, both projects started to rise around noon on September 9th.

Yearn.finance (YFI) hit a high of 38,869 on September 1st but dropped below $30,000 on the 4th and further down to a recent low of 18,638 on the 5th. However, with Coinbase's listing announcement, YFI surged past $30,000 again, reaching $32,698 at the time of writing.

Following YFI's listing on Coinbase, project founder Andre Cronje seemed pleased, stating that his initial claim that YFI had no value has been proven wrong. He pointed out, "One of YFI's initial goals was to launch without being classified as a security. There are three fundamental principles to being considered a security:"

1. Involvement of money transactions
2. Promising future value
3. Team commitment to delivering future value

Coinbase Planning Token Issuance Platform

The Initial Exchange Offering (IEO) trend was led by Binance last year, driving the crypto market into a mini bull run. Other exchanges such as OKEx, Bitfinex, and KuCoin followed suit by launching their own IEO platforms. However, the hype faded in the latter half of the year, leaving only sporadic IEO projects. This year, the primary token issuance mechanism has been replaced by DeFi-based liquidity mining.

However, there are signs of a recent revival in IEO, including FTX's IEO project "Serum (SRM)." The founder of the exchange, Sam Bankman-Fried (SBF), mentioned that more IEOs are on the way.

Recently, Coinbase's Asia sales manager Kayvon Pirestani revealed at the CoinDesk Asia Investment Summit that they may soon launch their token issuance platform. He stated:

It's not just IEOs; we are also carefully exploring the field of Security Tokens (STOs). I can't announce any formal news yet. While IEOs may be announced in the coming months, STOs are facing challenges. There has been a lot of discussion about STOs, but very few have actually been traded.

Coinbase has been acquiring compliance securities companies such as Keystone Capital, Venovate Marketplace, and Digital Wealth since 2018. Pirestani emphasized: "We will wait for greater market demand and introduce STO projects when the time is right."