What is meant by Yearn Finance YFI

Rancakmedia.com – Yearn Finance YFI is a collection of Ethereum-based protocols that allow users to maximize their crypto asset profits through lending and trading.

One of a number of new decentralized finance (DeFi) initiatives, yearn.finance delivers its services using only code, reducing the need for financial intermediaries such as banks or custodians. To achieve this, it has set up an automatic reward system around its YFI coin.

YFI's Year Finance Platform

  • APY data table describing interest rates in various loan protocols.
  • Earn which shows the largest interest rate that users can get by lending assets.
  • Vaults is a collection of investment techniques aimed at getting the most out of other DeFi ventures.
  • Zap packs multiple deals in one click, saving you money and effort.

Users earn YFI tokens by locking cryptocurrencies in yearn.finance contracts operating on the Balancer and Curve DeFi trading platforms, using the yearn.finance platforms.

Yearn.finance leverages a process known as “crop farming”, in which users lock bitcoin assets in a DeFi protocol to obtain additional cryptocurrency. The more assets a user locks up on a platform, the more tokens the protocol provides.

YFI's Year Finance Platform

In its first month of existence, the yearn.finance platform raised around $800 million in assets, making it one of the fastest growing DeFi initiatives to date.

How YFI's Yearn Finance Works

Yearn Finance YFI is a protocol meant to deploy contracts to the Ethereum blockchain as well as other decentralized exchanges operating on it, such as Balancer and Curve.

In this approach, users trust that YFI contracts, as well as related contracts in Balancer and Curve, will be implemented on Ethereum to perform the stated services.

Loans and Trade

Most yearn.finance Earn, Zap, and APY offerings attempt to allow users to lend or exchange their bitcoins.

Earn is a technique for users to receive the best loan interest rates, and works by scanning several loan protocols, such as Aave or Compound, to find the best rates.

Users can then deposit their DAI, USDC, USDT, TUSD or sUSD on the yearn.finance platform to earn these interest rates.

Likewise, Zap allows users to achieve multiple investments with one click. For example, users can exchange DAI for yCRV (another DeFi cryptocurrency) in one click, compared to three steps on yearn.finance and Curve platforms.

Save on Opportunity Costs and Transaction Fees

APY (which stands for annual percentage yield) searches the entire lending protocol that Earn uses, and offers users estimates of how much interest they might anticipate to earn, each year, for a given amount of funds.

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