What Is Yearn Finance?

Deepshikha  |  Dec 16, 2020

Selected tokens have outperformed BTC and Altcoins, and YFI is one of them.

Launched in July 2020, Yearn.finance is a popular decentralized protocol introduced by cryptographer Andre Cronje. Since it launched the native cryptocurrency of Yearn.finance, YFI has become one of the largest Ethereum based tokens. Working with the motive of “Defi made simple” you can think of Yearn.finance as a guardian that guides you to find the best yields in Ethereum DeFi.

Before getting into the depths of YFI, it is reasonable to get the context of Yearn.finance. Most people refer to it as a robot adviser (which is absolutely so) but the problem is that a noob will be confused looking at options like a vault, Earn, APR to name a few.

Taking inspiration from the inconsistencies in the yields offered by Defi applications (Dapps), Andre Cronje developed an Ethereum based protocol. Which largely focus on providing users with higher yields on deposits of altcoins. 

Features of Yearn Finance

The main feature of the protocol is a “vault” that allows users to earn by depositing their digital assets. The deposited funds then use a strategy that maximizes yield and minimizes risks. 

Apart from “vault” other services that are offered by Yearn.finance are Earn and Zap. While on one hand Earn supports Stablecoin and tokenized BTC, Zap is mainly focused on swapping traditional stable coins for liquidity provider tokens.

Importance of YFI in the market

Given that Defi has nearly $8 billion in crypto-assets committed to it, investing in YFI is continuously making waves in the sector. It reflects a strong commitment to decentralization. Additionally, there is no pre-mine of YFI tokens. The unique toolset provides unmatched security, open-source codes, and leverage proprietary protocols that increase investor’s yield. 

The offered features and convenience to the users set the bar significantly higher for this decentralized protocol. As more users will adopt this unique platform soon. It is no surprise that the token will gain high momentum in this crypto-winter.

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