Yearn.finance is a DeFi yield aggregator that runs on the Ethereum blockchain.
DeFi stands for decentralized finance. DeFi is a cryptocurrency movement designed to offer traditional financial products and services without the "centralized" authority of a bank, government or business.
Yield aggregation refers to investing using the most current optimal strategy to maximize returns.
The optimal strategy is constantly changing.
Yearn is the easiest way for consumers to earn interest and maximize their returns on their cryptocurrency while also saving money on transaction fees and time spent researching.
In some ways this makes Yearn is similar to the roboadvisor products offered by Vanguard, Wealthfront and Betterment.
Yearn offers a suite of yield aggregation products:
You can read more about each of them on the sidebar.
$YFI (wai-fu) is the token for Yearn Finance with a total supply of 30,000.
Yearn described $YFI as follows:
"In further efforts to give up this control (mostly because we are lazy and don’t want to do it), we have released YFI, a completely valueless 0 supply token. We reiterate, it has 0 financial value. There is no pre-mine, there is no sale, no you cannot buy it, no, it won’t be on uniswap, no, there won’t be an auction. We don’t have any of it."
This did not stop the price of $YFI rallying by more than 4,000% within days of release.
It doesn't matter what any of us say or think, only what the market thinks. And the market thinks $YFI is valuable.
Let's explore why.
Governance: If you hold $YFI (any amount, a full 1 is not required), you are eligible to vote in governance proposals known as YIPs (yearn-improvement-plans) and contribute to the future of Yearn.
Cryptocurrency: $YFI is a valuable, highly speculative asset. There is strong liquidity support on major DEX and CEX platforms with millions in trading volume per day.
Interest Bearing: When you stake your $YFI to vote in governance, you earn a percentage of fees that are accumulated from the different Yearn Finance products like Vaults.
These features make $YFI much more than just a governance token.
Typically a cryptocurrency project will run a pre-sale for their token prior to launch. This allows them to raise funds for development, marketing and other expenses. It's very similar to an angel investing round, where the earliest investors will receive the best price. Naturally this creates a dynamic where private investors have power over the public, leading many to question the legitimacy of other popular DeFi products.
Yearn Finance did the complete opposite. They released the entire supply of 30,000 $YFI at once. To earn $YFI you needed to provide liquidity to one of three pools. Incredibly the founder Andre Cronje did not keep any $YFI for himself or the team.
By acting without greed, Yearn has created the first truly decentralized autonomous organization.
Owning $YFI gives you a say in future governance while also earning a return and functioning as a cryptocurrency.
Yearn.Finance is a DeFi yield aggregator
$YFI is the Yearn Token (only 30,000 minted)
You do not have to own $YFI to use Yearn
You do not have to own a full 1.0 $YFI
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