YFI is an ERC-20 token of the Yearn Finance project. Yearn Finance provides a group of services on its Decentralized Finance (DeFi) platform. Decentralized Finance is a part of the crypto industry that works on financial services in contrast to the traditional banking system. Even though this industry is very young, it is also fast growing. By July 2020 this industry had about $4B circulating in the system. While at the beginning of 2019 there was only $275M.
Yearn Finance combines different parts of DeFi technologies in one service. There are four main products now: vaults, earn, zap, and cover. Let’s take a closer look at each of them.
Vaults give people an opportunity not to miss good market offers. It does not require any special knowledge about investments and markets, the platform generates the yield automatically according to the best offers on the market.
Yearn Finance has partnered with a number of services and created an aggregator that helps to optimize the process of interest accrual. Yearn Finance clients are able to get the highest interest rates.
Zap tool allows users to swap between liquidity pools. One of the advantages of Zap is reduced transaction costs. However, it still may feel a little pricey. On the other hand, it is super fast and simple. So if time is your priority, Zap can provide you with a solution.
Yearn Finance is providing insurance. This helps their clients to worry less about possible losses. To get the insurance user has to make a weekly payment, which is a 0.01% fee. The good thing is that all the deposited amount is considered to be covered by insurance.
There are also a number of services that are under development now. There will be yTrade, yLiquidate, ySwap, yBorrow.
The platform is governed by YFI holders. They have a right to submit a proposal, then the voting follows. If the proposal gets more than 20% of tokens that are staked in a governance contract and gets more than 50% of votes, it can be implemented.
The main name that is associated with YFI is Andre Cronje. Andre is not new in the Crypto World. He has a long career in this field. He is also participating in two other projects: Fantom and CryptoBriefing. The YFI started when Andre Cronje worked with Curve Finance and Aave. YFI is his latest project that seems to be extremely successful.
If you would like to join the world of DeFi at the Yearn Finance platform, you need to have YFI tokens. We welcome you to use the SimpleSwap exchange, here is a short instruction:
We hope that this article has given you a basic understanding of the Yearn Finance token and some ways to use it. Thank you for reading.