The Yearn Finance platform which was found at https://crypto-engineapp.com/was created on July 17, 2020. It brought out its native digital currency too. This is the YFI token. The token is a governance one. Therefore, users are eligible to vote on it. They may decide the direction the protocol must take. It is also an Ethereum-based one.
The coin took the digital currency world by storm! Within a month, it rallied from $3 to $30,000. Once again, YFI has been garnering great attention. It happened in June 2022. It is because of its upswings and downswings.
June 18, 2022, was a significant day for the YFI token. Its price almost dropped to the $4,000 level. Experts declared that it was below the 22-month lows. However, the price did not dip any further after that.
Instead, the token started rallying! By June 24, 2022, YFI had approached $5,400. However, within the span of a few hours, it had jumped to $8,000. This was a tremendous spike!
It permitted YFI to rid itself of its previous losses. Regardless, YFI is a crypto winter loser. It has sustained losses totaling 92%. This is a drastic contrast to its once all-time high.
Over the last six months, YFI has experienced tremendous volatility. Its pricing was $40,000. It had come down to $4,000. Currently, it is trading at $6,724, on major platforms.
Change in Compensation Policy
The recession prompted Yearn Finance to go in for some changes. The platform changed its compensation policy drastically. It should serve to keep the protocol sustainable.
A proposal came into being on June 21, 2022. It was published by Banteg. Banteg is one of Yearn Finance’s major contributors. This proposal may have been the catalyst of the rally linked to YFI pricing.
The proposal suggests that Yearn Finance is looking for full-time contributors. It is doing so, even during the crypto winter. It is ready to offer a flat compensation level to each contributor. This compensation will be per month. It will be a total of 10,000 DAI and $10,000 worth of YFI.
Earlier, Yearn Finance offered full-timers 45% share of the net profits. Similarly, when KPIs were reached, they received a monthly sum. It amounted to a 2,000,000 DAI floor pool. KPIs stand for key performance indicators.
Now Yearn Finance is going in for reduced rewards. This should serve to display a healthier spending model. In turn, it will enable the platform to remain stable, even during a bearish run. The overall reduction in compensation spending is 6.17x.
Banteg also talked about the platform’s treasury. It possesses cash reserves of $18.1 million. This suffices to satisfy its team members for two years.
Get Acquainted with Yearn Finance
People refer to it as yEarn, too. The platform owes its origin to Andre Cronje. He is a developer of financial technology. He lives in South Africa. He discovered that diverse DeFi applications offered different yields. Therefore, he decided to create the Yearn Finance platform.
Yearn Finance follows an Ethereum-based protocol. The aim is to help its fans gain the greatest yields on their deposits. The deposits could involve Stablecoins, Ether, or altcoins.
The main aspect of the protocol is vaulted. They permit investors to deposit funds in them. In turn, the investors earn yields. There is a strategy for maximizing returns. It also works for minimizing risks.
In the beginning, vaults only concentrated on Stablecoins. Today, it supports Chainlink, Ether, tokenized products of Bitcoin, etc.
Vaults are extremely useful for mitigating the high costs of transacting on the Ethereum blockchain. They permit the pooling of capital. This way, the controller of each vault has only one account on hand. Therefore, he/she must pay transaction charges (gas) to yield farms.
Another service of Yearn Finance is Earn. It supports only tokenized Bitcoin and Stablecoins. It is because it is Vaults’ slimmed-down version.
Zap is the third service. It permits members to exchange traditional Stablecoins for liquidity provider tokens. These tokens are representations of Stablecoins.
Yearn Finance is busy with other products too. One of them is StableCredit. It will promote decentralized borrowing and lending. Another is sure. It refers to a decentralized insurance protocol. It will prove suitable for DeFi users.