Thread by @50ftDinosaur

I was recently asked for a high-level overview of @yieldyak_ and $YAK. Here goes…

Disclaimer: Not financial advice. Do your own research etc.

What is Yield Yak and what is the $YAK token?

Yield Yak is a yield optimizer on the Avalanche network (c-chain, specifically). You can stake your crypto assets (single asset staking) or you can LP on a DEX and deposit that LP to Yield Yak’s auto-compounder.

This takes the rewards you would earn from providing liquidity and then it sells those rewards for more LP tokens. Essentially growing your stack without having to do anything (the reinvesting is managed by the community auto-magically).

What is $YAK?
$YAK is the governance token for Yield Yak. It is multi-faceted, in that, not only can it be used for governance (which will be used for voting on the protocol), but it also ensures that holders of $YAK earn a portion of the revenue that Yield Yak generates.

Rewards are in $AVAX (not some large supply, inflationary token like others). You can stake $YAK on the platform to auto-compound the $AVAX rewards and increase your $YAK bag. You can also LP $YAK on various DEX’s and then deposit those LP tokens on Yield Yak to auto-compound

those rewards and increase your LP. Lastly, sustainable incentives (more on this below). Incentive models will use network revenue rather than inflating supply.

Why is $YAK different?
$YAK has a very small maximum supply of only 10k $YAK tokens. That’s it. That’s all there’ll ever be. So first of all, it’s scarce. Currently, the circulating supply is < 7,000 $YAK.

Secondly, $YAK generates revenue by staking it, and in doing so, creates buy pressure. How, you ask? Because rewards (AVAX or LP rewards) are automatically sold for more $YAK on a constant basis. Stake $YAK -> rewards are sold to buy more $YAK -> rinse & repeat, ad infinitum.

Add to this an ever-increasing TVL (Total Value Locked) for Yield Yak, which increases everyone's yield. This increases protocol revenue and creates a positive feedback loop.

With many other Yield Optimizers (or native tokens of DEX’s) there is constant sell pressure as the reward emissions are constantly dumped/sold for profit or to be re-invested.

Couple this with usually large (or infinite) circulating supplies and you have sell pressure on an inflationary asset - uh oh.

So, why do some people feel it is still a good time to buy $YAK?

At time of writing, Yield Yak’s TVL is over $76m. $YAK market cap is currently around $27m (FDV is ~$40m). 80% of circulating supply is locked in single-sided staking or LP. So mcap is still < TVL, by a long way.

The airdrop has been done and 7,000 $YAK were airdropped to the community. At today’s $YAK price of ~$4,000 that’s ~$28m -- just given away. We’ve seen many of the airdrop recipients already sell their $YAK (paper hands) and due to the tokenomics mentioned above, many of the

remaining holders see the value and future that hodling $YAK may bring. 70% of supply is in the hands of the users. 15% of supply is for the team (locked for months) with the remaining 15% to be used for partnerships.

Avalanche this week has seen the launch of @BenqiFinance, with further announcements that @AaveAave and @CurveFinance are coming to Avalanche with a whopping $180m liquidity mining incentive program from @avalancheavax.

Yield Yak plans to create vaults and strategies around lending that will increase TVL and increase user's APY. Given the above positive feedback loop, this will likely increase the value of $YAK.

Roadmap wise, there are many other things in the pipeline. $miniYAK is coming which is a 1:1 pegged asset to $YAK that will create volume and mitigate unit bias (which is real). Yield Yak Swap (DEX aggregator) which gets you the best returns for your trades (already live).

And liquidity staking is on the horizon, also.

Super excited about #AVAX #AvalancheDeFi #AvalancheRush and $YAK!

Happy Yak'ing!

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