In this guide, I will talk about yearn.finance (YFI).
In this guide, I will talk about yearn.finance (YFI). I will try to answer all your questions about the decentralized finance (DeFi) protocol.
↘️What is Decentralized Finance (DeFi)?
Decentralized finance are structures where users interact with a single wallet from anywhere in the world. Since decentralized finance applications are open source, they can be controlled by anyone, do not have a centralized structure, and users can create their own applications by forking whenever they want.
↘️What is Yearn.finance (YFI)?
Yearn.finance is the protocol on the Ethereum (ETH) network that allows users to borrow and trade cryptocurrencies.
The application grows in the DeFi space, providing incentives without any third party application. In addition, its own token YFI is treated as a kind of incentive.
Yearn.finance has several different standalone products:
✅APY: It shows interest rates over different borrowing protocols.
✅Earn: It shows the pool with the highest interest in case you lend.
✅Vaults: Shows which of users' other DeFi projects will yield the highest returns.
✅Cap: It saves you from cost and work by creating several different baskets.
Users can lock YFI tokens for trading via Balancer and Curve.
This allows you to perform yield farming . In the Yield farming process, users lock their cryptocurrencies on the platform in return for a reward.
↘️How Does Yearn.finance Work?
Yearn.finance is a project that enables it to connect to other decentralized exchanges (DEX) through the Ethereum network.
In this way, users can rely on YFI contracts and perform different transactions.
↘️Debt Transactions and Trading
Most of Yearn's services allow for cryptocurrency transactions.
Earn, on the other hand, is a product that aims to provide the best returns, such as Aave and Compound.
Users can deposit their DAI, USDC, USDT, TUSD and sUSD on the platform for interest.
Zap allows it to make several different investments with a single button. For example, users can trade their DAI with yCRV. This saves time and money.
↘️Yearn.finance Vaults
Vaults allow traders to create active investment strategies. In this way, the safes function as a kind of managed joint funds.
Although it may seem complicated from a distance, investing in the safe is actually simple. Thanks to the application interface, it allows them to deposit cryptocurrencies easily and the returns of all funds can be seen easily.
↘️What is YFI Token?
YFI is seen as the governance token of the Yearn protocol.
30,000 YFI has been distributed so far. But according to the document, more YFI can be issued when required.
YFI can be easily purchased and users need to stake YFI to have a say in the protocol. After completing the staking process, they can have a say in the operations in the protocol. But as soon as they do the staking process, they cannot withdraw for three days and receive a small fee in return.
Yearn charges a 5% fee for withdrawals. The high fee is distributed to the provision of the treasury and YFI holders.
↘️What Happens When Users Make a Deposit?
Users buy tokens to prove their stake in the liquidity pool.
The stock exchange token is commonly used for yield farming and can be difficult for those who do not perform yield farming.
When people deposit their tokens in pools, you may not get anything. It allows you to receive your money in your account and your deposit with your ID.
But DeFi protocols don't work like banks. On the contrary, you will receive a certain rate of interest for your transactions to your wallet address. To get your deposit back, you need to get it back using your tokens.
In return for the tokens you deposit, the protocol gives you proof of your deposit. Tokens prove your deposit and allow you to receive your tokens at any time interval. Also, tokens can be sold on another platform.
Yearn, which first started with stablecoin, offers transactions against different cryptocurrencies over time and is expected to increase over time.
↘️What Can Users Do with their yToken?
Yearn allows users to deposit their tokens more easily through automated market makers (AMM). For example, if you deposit USDT, you will receive yUSDT, which is the proof of your investment.
↘️What Is Yearn Doing On Safes?
If you want to understand what is done with Yearn vaults, you need to look at the smart contract codes. Feel the Yearn gives you an overview of what is happening in the vaults. However, some areas remain incomplete.
In some ways, the Yearn protocol manages to protect investors. Especially when you are knowledgeable in the field of DeFi, you can protect yourself against different risks.
↘️How Does Governance Work?
Yearn has its own governance functionality like other DeFi projects. There are also many suggestions for improving the protocol.
The biggest part of governance is that people suggest different strategies for different vaults. Users share their suggestions and are voted on by YFI owners. As a result, it cannot be put into practice. Part of the profit goes to the users.
Yearn has strong governance in DeFi protocols. In addition, persons with multi-signature authority are temporarily selected by YFI holders. If you want to look at the multi-signature owners, you can check the Boardroom profile
↘️What is yInsure?
#yInsure is a pre-written smart contract by Nexus Mutual. You don't need verification to protect your risk. But smart contracts protect some of your losses and do not act as insurance.
↘️How to Buy YFI?
YFI can be purchased both from the Year protocol and through exchanges. If you are buying from exchanges, you can easily buy it when you have an account on exchanges such as Binance, Huobi Global, Coinbase Pro, Bithumb and Bitfinex. You can use trading pairs on exchanges, especially YFI / USDT, YFI / USD, YFI / BTC and YFI / EUR trading pairs.
↘️yearn.finance Reviews
yearn.finance has been a protocol that has gained the trust of many people since its establishment. In addition, on a platform where system attacks are frequent, it has gained the trust of many users that it stands strong and is not damaged.
↘️Frequently Asked Questions About yearn.finance?
Protocol checked?
The protocol has passed a general inspection. You can access the audit report on docs.yearn.finance.
↘️Where can I give suggestions about Yearn?
You can make suggestions and ideas about Yearn on Discord, Telegram, Github, and the Forum.
↘️What are the functions of safes?
-Cases offer you automated investment strategies.
- The users share their ideas in the protocol and try to present the best possible investment.
-Cashes serve the functions of providing liquidity, offering provision, borrowing and lending transactions, farming and re-depositing
↘️Can I process transactions on my own?
You can, but you will have to pay all gas charges.
↘️What are the risks involved in yearn.finance?
-In case the debts exceed the strategy, the provisions are locked. But when the strategy is out of debt, you can withdraw again.
Only some of the safes have been inspected.
Smart contract risks are always present.
↘️What Does yearn.finance Do?
yearn.finance allows you to borrow and borrow without any third party.