It's worth noting that "ye" also existed as the second person plural pronoun while "þe" simultaneously existed as a second person singular. These are now merged in most English dialects. Getting the unrelated definite article "þe" mixed up in this and substituting a "y" was more than just a matter of misguided font substitution because some forms of the handwritten thorn look very similar to a "y". Two words pronounced "the", one of which is easily conflated with another spelled and pronounced "ye" leads to the inevitable result.