0/ The importance of yETH and YFI cannot be understated.
In a recent Delphi Daily, I take a look at what yETH's impact on the space is and why it perfectly demonstrates how powerful YFI truly is. (thread below)
Full Disclosure: @Delphi_Digital holds $YFI
delphidigital.io/reports/yeth-n…
In a recent Delphi Daily, I take a look at what yETH's impact on the space is and why it perfectly demonstrates how powerful YFI truly is. (thread below)
Full Disclosure: @Delphi_Digital holds $YFI
delphidigital.io/reports/yeth-n…
1/ yETH is the new yVault strategy everyone is excited about.
yVaults are essentially token containers which then use those tokens to farm based on optimum strategies available to generate the highest-APY yield for the tokens deposited.
Kind of like a roboadvisor for DeFi.
yVaults are essentially token containers which then use those tokens to farm based on optimum strategies available to generate the highest-APY yield for the tokens deposited.
Kind of like a roboadvisor for DeFi.
2/ So what strategy does yETH deploy? It's easier if I show you (see image).
TLDR: The vault grabs your $ETH, locks it up in $MKR, generates DAI, puts that DAI into $yCRV token, farms yield using the strategy that fits best, uses that yield to buy ETH on the open market for you.
TLDR: The vault grabs your $ETH, locks it up in $MKR, generates DAI, puts that DAI into $yCRV token, farms yield using the strategy that fits best, uses that yield to buy ETH on the open market for you.
3/ yETH demonstrates just how composable protocols within Ethereum’s ecosystem have become. @MakerDAO CDPs are used as a bridge for ETH to be used for farming in DeFi.
yETH essentially makes idle ETH an extremely productive asset.
yETH essentially makes idle ETH an extremely productive asset.
4/ So, what assets is yETH immediately bullish for?
At a high level, bullish for $ETH $MKR and $YFI
Bearish for $CRV (although I go off on a quick tangent within the post to expand why this is worth thinking through further).
At a high level, bullish for $ETH $MKR and $YFI
Bearish for $CRV (although I go off on a quick tangent within the post to expand why this is worth thinking through further).
5/ While I highlight a few risks associated with yETH, a key one that I thought was mitigated well by the strategy is liquidation risk.
To make sure yETH's CDP stayed above MakerDAO's min. collateralization ratio of 150%, yETH maintains a 200% collat. ratio.
But that's not all.
To make sure yETH's CDP stayed above MakerDAO's min. collateralization ratio of 150%, yETH maintains a 200% collat. ratio.
But that's not all.
6/ yETH is natively integrated with Maker's oracles so it can effectively know what the price of ETH is going to be for MKR in the following hour.
If its CDP needs to be rebalanced, there are incentives in place (a small commission) for anyone to call the rebalance function.
If its CDP needs to be rebalanced, there are incentives in place (a small commission) for anyone to call the rebalance function.
7/ So, how's yETH currently doing since launch?
🔹Vault is currently earning ~92% APY
🔹Already ~345k $ETH locked in yETH
🔹At the current ETH price, that's over $140 million!
🔹DAI utilization rate for ETH is at 82% (MKR holders just voted to raise ETH's debt ceiling)
🔹Vault is currently earning ~92% APY
🔹Already ~345k $ETH locked in yETH
🔹At the current ETH price, that's over $140 million!
🔹DAI utilization rate for ETH is at 82% (MKR holders just voted to raise ETH's debt ceiling)
8/ It's pretty impressive to see how much ETH has already been locked up. yETH's impact on the space will be long-lasting.
The creation of it also perfectly demonstrates how powerful @iearnfinance truly is.
The creation of it also perfectly demonstrates how powerful @iearnfinance truly is.
9/ The ETH yVault was the first community-developed vault.
Developers who submit new strategies that are implemented get 10% of the 5% performance fee $YFI charges.
As you can see below, a simple proposal can generate significant income for a developer.
Developers who submit new strategies that are implemented get 10% of the 5% performance fee $YFI charges.
As you can see below, a simple proposal can generate significant income for a developer.
10/ While @AndreCronjeTech is just one man, what YFI has achieved with its brilliant incentive alignment here is tapping into a global network of hungry and talented developers.
Over the next few weeks, expect to see hundreds of new proposals suggested.
Over the next few weeks, expect to see hundreds of new proposals suggested.
11/ It's hard to give just one reason why our team is so excited about $YFI
🔹easy to use
🔹very fee efficient
🔹clearly product--market fit
🔹yields are extremely attractive
🔹generates $ for token holders w/ limited supply
🔹easy to use
🔹very fee efficient
🔹clearly product--market fit
🔹yields are extremely attractive
🔹generates $ for token holders w/ limited supply
12/ But most importantly, it’s been able to build one of the strongest communities we’ve seen in a short amount of time due to its fair launch. This is likely just the beginning for YFI.
Oh my...
@learn2yearn
Oh my...
@learn2yearn
