DeFi, the platform, is a distributed system of electronic financial instruments providing access to blockchain-based lending services. Decentralised services eliminate the dominance of intermediary companies and reduce the entry barrier.
DeFi projects fulfil the dreams of early crypto-enthusiasts to embed distributed ledger technology into the current financial system. Compared to traditional lending services, they are more efficient, reliable and transparent, so there is no need for intermediaries. A person from South America or Africa can easily borrow money from a resident of Japan, or any other country. The software code acts as a banker and insurance agent, the underlying blockchain ecosystem guarantees the transaction, and disputes are resolved through a smart contract.
These applications and services can be very useful in countries with underdeveloped and unstable economies. But residents of the world’s leading powers are also interested in new types of financial services and capital-increasing options. The DeFi market is growing steadily and more and more successful projects are emerging. Today we will talk about the Yearn Finance platform, which without exaggeration can be called a model of profitable investment. Investors who believed in this project made an incredible 35,000% profit in a week.
What is Yearn Finance (YFI)?
The Yearn Finance platform enables crypto coin holders to participate in Yield Farming by interfacing with DeFi-protocols. Blockchain-based farming is like simply planting seeds in the ground to multiply them.
To harvest a crop from the Yearn Finance DeFi platform, you need to blockchain (bid) in cryptocurrency. YFI virtual tokens are distributed to platform members as rewards.
YFI’s surge has made the Yearn project one of the best farming pools in the current period. And while the company’s official website https://yearn.finance/earn honestly warns, “This project is in beta testing. Use at your own risk”, not even a month later the new YFI tokens soared from zero to $6941. After that, the price dropped slightly and then went up so sharply that the YFI token was worth more than bitcoin for some time.
It could not stay ahead of the cryptocurrency king for long, but became the most expensive definite coin. On 21.01.2022, 1 YFI can be sold on the exchange for $30,177. And the historical high was recorded on May 12 this year, at that time one YFI coin was worth $93,435. Investors who bought the coin at a low price of $739 the year before last and sold it at the peak of the surge have reaped huge dividends. Although, of course, it’s not certain that this was the YFI token’s last historical high.
Yearn Finance (YFI) technical analysis
Yearn Finance’s decentralised aggregator ecosystem uses services such as Aave, Compound, Dydx and Fulcrum to optimise token lending. When you deposit your crypto-assets in Yearn Finance, they are converted into yTokens, which are rebalanced periodically to select the most profitable lending services. Yearn’s goal is to identify promising DeFi services for mutually beneficial synergies. It turns out that by bringing several DeFis together, Andre Cronje and his team have created an entirely new and efficient platform for decentralized finance.
One of the best known integrators of yTokens, is Curve.fi. It is a platform creating an AMM (Automated Market Maker) between yDAI, yUSDC, yUSDT, yTUSD.
YFI is the management token of the platform. The asset is only distributed to users who provide liquidity using the yToken. That is, you place bets and receive interest. The YFI project sought to release the most decentralised digital asset, with no pre-mining, pre-selling or distribution to the team. Any changes are made through network bids and voting. Every YFI token holder has the right to vote.
Interesting news about the Yearn Finance (YFI) project
The success of Andre Cronje’s project has encouraged other blockchain programmers to create clones. At the end of July, yfii finance (YFII) token appeared, and on the first of August, yffi finance (YFFI) was launched. The developer of another copy of yEarn Asuka Finance was accused of exit-skimming altogether. The original yEarn Finance (YFI) coin maintains growth amid the collapse of imitators.
Incidentally, Cronje himself did not receive a cent for taking the lead in developing the protocol. He was forced to borrow money to launch the project and now has an outstanding loan of around $20,000.
Following a claim by popular cryptoblogger Hasu that the head of YFI has sole access to $40,000,000 of user assets, the level of control over the wallet was immediately changed. It now requires the consent of at least six people to move funds.
Afterwards, Andre Cronje said he was tired, broke and on the verge of leaving. But, he soon retracted his words and wrote in his tweet: “Back in March I made the decision to continue regardless of the circumstances. The blockchain space will not get rid of me as long as something else can be created here.”
But he subsequently changed his mind and started working with even more enthusiasm. By the end of 2020, YFI had absorbed several smaller yield aggregators, and then his team, along with developers Curve, launched Yearn’s Vault, a collaborative project for yield farming CRV tokens.
To improve security, the decision was made to outsource the search for vulnerabilities in the codebase. To do this, the Bug Bounty program was launched, providing rewards for “white” hackers.
In May this year, cryptocurrency YFI, along with AAVE, LINK, MKR and UNI, was added to Wirex’s list of supported payment assets. Users of this platform were able to store, exchange and spend these currencies using a Wirex contactless card at tens of millions of merchants around the world.
Yearn Finance (YFI) mining
YFI cryptocurrency is not mined by traditional ASIC or video card mining. But, it can be earned by investing in the project. That is, you first buy tokens on an exchange, make a bid and get rewarded.
Where Yearn Finance (YFI) tokens are sold
YFI tokens can be purchased on one of the forty Yearn Finance exchanges. The largest trading volume is on the Binance platform. Four trading pairs are represented here at once:
For a full list of both exchanges and exchange pairs, see coinmarketcap.com.
How to sell Yearn Finance (YFI) coins on an exchange
In order to sell tokens on the exchange, you need to go through the registration process. On Binance, it only takes a few minutes, after which you must be sure to go through KYC. Under the new rules, which take effect on August 20, 2021, all users who want to work on the exchange must complete an intermediate stage of identity verification. The procedure is straightforward, you need to provide your personal details, upload a copy of your passport and a portrait photo, and then undergo a dynamic face verification using a webcam or smartphone app.
Then you need to take steps to further secure your account by activating two-factor authentication, and then you can make a deposit on the exchange.
Open the spot wallet, look for YFI cryptocurrency in the list and press “Enter”. The address to send the money to and a QR code to complete the transaction via your smartphone will be displayed. Complete the transaction and after 12 network confirmations the coins will be deposited. Tap the “Trade” button and select one of the supported pairs. You will be redirected to the trading section.
Now you need to execute a sell order. To sell coins at the market, select “Market”, but if you are not satisfied with the current price, create a limit or stop-limit order and wait for it to be executed. For more details on the different types of exchange orders and the nuances of how they are executed, please refer to the Binance overviews on our website. Once your trade is complete, the assets need to be withdrawn from the platform to your personal wallet.
If you don’t want to register and be verified, connect to the decentralised Uniswap platform. There you can buy or sell Yearn Finance token for ETH, bitcoin wrapped, USDT or DAI. YFI cryptocurrency can be exchanged for etherium or other ERC-20 tokens directly in your MEW or Metamask wallet using the swap feature.
Yearn Finance (YFI) wallets
The YFI digital coin is created using the ERC-20 standard and is supported by MEW wallets, Metamask and other applications that work with ERC-20 tokens.
If you cannot find YFI in the list of tokens, add manually. You need to select the “Add Token” option in the wallet interface and enter the smart contract address 0x0bc529c00C6401aEF6D220BE8C6Ea1667F6Ad93e and the YFI trade ticker.
If the amount is small you can keep the deposit on the exchange. If you did not buy a large amount of coins, a Ledger Nano type hardware safe is best for storage. Placing crypto assets for long-term storage in an exchange deposit is not recommended due to frequent hacking attacks.
The phenomenal success of Yearn Finance’s DeFi platform shows that the global community will soon be ready to accept digital assets as a financial instrument. In the 10 years of the crypto industry’s formation and development, people have accumulated a large number of virtual coins. Token holders do not want the money to lie dead weight until the next price hike, so they invest in blockchain projects for profit.
The yield farming investment strategy is attracting more and more attention and, most importantly, it actually works. The mechanism for putting yields on the market, while conservative, is quite successful. However, caution should be exercised not to invest in a scam. The decentralised financial services market is inclusive. Anyone can create and run a blockchain application, but not all developers are committed to law and order. This is one of the reasons why regulators are paying more attention to this segment of the market. The powers that be are trying to control the exchange of digital currencies. And how can anyone ignore a market with a global capitalization of 1.9 trillion U.S. dollars? Sooner or later, everyone who wants to work anonymously will move to the darknet, while the legal platforms will be able to make a steady profit.