Users can then deposit their DAI, USDC, USDT, TUSD or sUSD on the yearn.finance platform to receive those interest rates. The majority of yearn.finance’s services – Earn, Zap and APY – seek to enable users to lend or trade their cryptocurrency.Įarn is a way for users to get the best interest rate on lending, and it works by searching across different lending protocols, such as Aave or Compound, to find the best rates. In this way, users are trusting that YFI’s contracts, as well as those in associated contracts on Balancer and Curve, will deploy on Ethereum in order to provide the advertised services. Yearn.finance is a protocol designed to deploy contracts to the Ethereum blockchain as well as other decentralized exchanges running on it, such as Balancer and Curve. In its first month of operation, the yearn.finance platform attracted nearly $800 million in assets, making it one of the fastest-growing DeFi projects to date.
The more assets users lock in a platform, the more tokens they are awarded by the protocols. In this way, yearn.finance capitalizes on a practice commonly called “yield farming,” in which users lock up crypto assets in a DeFi protocol in order to earn more cryptocurrency. Users earn YFI tokens by locking cryptocurrencies in yearn.finance contracts running on the Balancer and Curve DeFi trading platforms, using the yearn.finance platform. Zap – Which bundles several trades in one click, saving on costs and labor.Vaults – A collection of investment strategies designed to generate the highest returns from other DeFi projects.Earn – Which identifies the highest interest rates users can earn lending an asset.APY – A data table that shows interest rates across different lending protocols.The yearn.finance platform consists of several independent products, including: To do this, it has built a system of automated incentives around its YFI cryptocurrency. One of a number of emerging decentralized finance (DeFi) projects, yearn.finance provides its services using only code, removing the need for a financial intermediary like a bank or custodian. Yearn.finance is a group of protocols running on the Ethereum blockchain that allow users to optimize their earnings on crypto assets through lending and trading services.
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