How does yearn finance work?

Tawana Sowden asked, updated on January 1st, 2021; Topic: yearn finance
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But the concept is quite simple. yEarn moves the supported stablecoins between Compound, Aave, dYdX, and Curve depending on which asset pool is offering the highest yield. The purpose of using Curve is to increase rewards in yEarn tokens. So when a user deposits DAI they receive yDAI in return.

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Event, why did yearn finance go up?

Three factors likely triggered the rally of YFI to a new all-time high: a potentially new partnership, a listing on Aave, and strong technicals. On Aug. 28, the money market protocol Aave (LEND) listed YFI. Aave is the largest DeFi protocol in the global market with more than $1.52 billion in total value locked.

That, what is yearn Finance vault? Yearn Vaults are the brainchild of Yearn Finance, and comes as a response to the recent yield farming and liquidity mining trends. Specifically, Yearn Vaults are pools of funds following certain strategies, which attempt to provide passive income streams through competitive yield farming strategies.

More than that, how do you earn YFI?

The easiest way to get YFI is to buy with DAI or ETH on 1inch exchange — a decentralized trading platform or so called DEX. For more experienced DeFi users, buying from Balancer directly with DAI will cost least gas and slippage most of the times.

What is yearn Crypto?

YFI is the native cryptocurrency of the Yearn. finance protocol. It is a governance token that allows users to vote on which direction they want the protocol to head. Since its launch in July, YFI has become one of the largest Ethereum-based tokens due to the protocol's focus on automated yield farming strategies.

2 Related Questions Answered

What is the deal with Bitcoin?

So, what's the deal with Bitcoins? Bitcoin is, at its core, virtual currency. It is a digital representation of money that can be used to purchase goods and services in the same way cash can be used to purchase those same goods and services.

What is the Dai?

DAI is an ERC20 token on the Ethereum blockchain that has a steady value of one US dollar. It is also the key to the MakerDAO lending system. When a loan is taken out on MakerDAO, DAI is created. It's the currency users borrow and pay-back. Once DAI is created, it functions simply as a stable Ethereum token.