Yearn Finance is one of the hardest hitting concepts in the defi (decentralized finance) industry.

I think it may be one of the applications that will grow the most in the future, but nothing is certain because we are dealing with a wild west of the world, which in this case is no longer at the western border of the United States but in the virtual world.

Will Yearn Finance be a mass application in the future?

Or will it fall through like so many other unreleased projects?

Impossible to know. That's what it's like to be in the world of innovation. Some technologies will triumph and others will go to hell.

I will try to dissect a little what this platform is about? Application?

What is Yearn.Finance?

According to the strictest definition, it would be a DeFi protocol, that is, a kind of application for the world of decentralized or fringe finance, call them what you want. Moreover, this ecosystem is based on the Ethereum technology, with which it is closely linked.

And what is this protocol for?

The goal is basically to be an app that allows users to access yield farming and cash mining projects.

Ok, wow, and what is it?

It's not something that lacks complexity, really.

How does this pay off in agriculture?

Let's not go too fast, but the important thing is that we are dealing with a blockchain and DeFi type project with the aim of creating trading and financing services between users around the world who of course have access to these protocols.

We are therefore in front of a blockchain-type financial platform.

Its creator was Andrew Cronje, a well-known programmer in this world of cryptocurrencies and tokens. Its purpose was to promote cross fund movements from other apps such as Compound, didx and Aave. These platforms belong to the lending or lending industry, and they seek to connect users with excess capital and others with a funding request, and all without (supposedly) intermediaries. The objective of Yearn.Finance is to obtain the best conditions for each actor, in a decentralized and automated way.

Another way of saying this is that Yearn Finance provides the technology so that smart contracts can change hands on the best terms for users, using the best pools of liquidity in the market.

It looks good.

It looks like some sort of stock exchange where capital is exchanged, but instead of the traditional stock market, we are faced with a crypto-like decentralized exchange.

Now we go with the concept of YFI, which also belongs to this project.

What is YFI?

YFI is Yearn's native cryptocurrency. In other words, it is another of the cryptocurrencies listed on the vast crypto market, both against the dollar, as well as against Bitcoin or against Ethereum.

But YFI is more than that.

It is a governance token that gives a sort of voting right to those who own it on the use that is given to the Yearn.Finance platform or ecosystem.

In other words, holders of this token become capitalists of this system we are talking about here.

Interestingly, when the token was created, the creator of Yearn distributed all the YFIs among the users in the community such that he distributed those voting and governance rights so that from then on , it was the community that decided what to do with the platform.

For example, the number of YFI is 30, and at the moment it cannot be changed, but it could be if the governance, i.e. a majority number of "votes" or users, so decides. Seen from this angle, the thing is a bit dubious, but at least it seems that it is in the hands of a democratic or capitalist system, or a mixture of both. According to Tarun Chitra, one of those who make up what would be the board of directors of this governance, says that the number of these tokens is unlikely to increase.

Regardless of that, whether they go up or not, which wouldn't necessarily be a bad thing, the value of this token grew like foam after its launch.

When it started, the value of this token was $3. A few months later, it was trading at $30 and rising. Who knows where this cryptocurrency, which was even worth more than Bitcoin at the end of 2020, could go.

Impressive eh?

With this, we are facing a capitalization of more than 900 million dollars. And if it continues to rise, who knows where it might end?

The truth is that many of those early YFI holders went on to become millionaires.

The curious fact is that when it was launched, Gronje declared that it had 0 financial value, and that the only purpose was to participate in the voting of decisions. According to the creator, there were no sales, no pre-mining, neither in the uniswap nor in the auction, and that's why he said it had no value.

However, we already see that this is not the case.

It's a curious example of how even a cryptocurrency ecosystem that wasn't meant to create a "business" or a "value" ended up becoming a value machine, much like the one that a stake in a capitalist corporation might have, only that the “shareholders” time is nominal, and instead of a shareholders meeting in a physical location, the “governance meetings” take place virtually.

YFI/USD quotation What is its price?

How does Year Finance work?

Ok, this ecosystem is made so that smart contracts can be exchanged between users using their technology and that of other exchanges such as Curve or Balancer.

All of this is done under the umbrella of Ethereum and its huge blockchain-like infrastructure, which means that all transactions take place in a decentralized way, as if they were peer-to-peer. It is the blockchain network that allows us to easily connect in this way.

At Yearn we have several functions:

• coffers
• Win
• Zap
• Experimental
• ready
• blanket

Let's start with the vaults or vaults

Suction Safes

This is the most complex and powerful service in this application. It allows users to follow trading and investment strategies in using the same algorithms as said network, i.e. everything is done automatically.

Keep in mind that the service is still in “beta” mode, as they show us on your screen, at least for now (this might change soon).

They tell you to use it at your own "risk".

You know, I told you at the beginning, it's a “virtual Wild West”.

You can win a lot but you can also lose.

In the application, there are several strategies. In the picture you can see some:

To use the service, you need to connect the wallet.

Which wallets are used to connect to Yearn Finance?

• Dappradar
• Wallet Connect
• Trezor
• register
• trellis
• Wallet link
• doors
• Fortmatic
• Torus
• Authentic
• Opera

Another detail to keep in mind about these strategies is that knowledge of programming code is recommended to understand how they work. However, it is not necessary to be able to invest in them, for which everything is designed to be simple.

Win

This is a loan-based service.

It is designed to search for all options available in related protocols, among which Compound or Aave, two of the most powerful lending applications in the DeFi market.

The objective is clear: to find the best conditions.

Now I'm telling you one thing, as with any loan, these aren't risk free either, and that's why I think you have to look carefully before choosing one, because remember this : the higher the interest, the higher the risk and the greater the possibility of default.

In order to aspire to participate in the project, you can deposit altocoins or stablecoins such as DAI, USDC, sUSD, USDT or TUSD. With these funds, they can already be lent to create these smart contracts and hopefully make a good profit in the indicated period.

As in the case of the Vault, Yearn warns us that the program is in "beta testing".

Zap

This is another service, in this case quick investments.

What does it mean?

That on other platforms like Curve, you have to do a series of actions (usually 3) before making the trade.

In the case of Zap, this can be done with just one click, so the model is designed for those looking for lightness and ease of use, which is associated with less trading costs, but also remember: more risk.

AVR

This becomes the annual interest percentage (annual percentage return, in another version of the name which would be APY).

The function is to search through all the loan providers that exist in the protocols used by Earn and give an estimate of the expected income for the user.

As we can see, more than an additional service, it is like a small application to facilitate decision-making when participating in the DeFiLending market.

The other products of the system are: ygov.finance, yborrow.finance and an insurance service under development.

Is Yearn.Finance YFI safe?

Well, if I'm being honest, I'm not going to tell you that it's 100% safe.

It seems clear.

An asset that goes from $3 to $30 in a few months cannot be considered safe.

Only this volatility tells us that we are facing a project with enormous risk.

The way to look at Yearn.Finance security is to compare it to a startup project, but instead of following the “traditional business” model, following the “virtual business” model.

A startup when it starts is a very risky project, because the same thing happens with Yearn.Finance.

Now, with risk comes potential profit.

The potential for this platform to carve out a niche in the mass market is there. And if that happened, we would surely see how the project grows to enormous size.

The question is whether this application is going to be demanded by the masses or not, or in other words, see if it can solve an urgent need of potential users. Is that the case?

In principle, it is a very hard-hitting application and is supposed to be the best or one of the best in its category. This did and does that more and more users are interested in it and its fundamentally decentralized essence.

Honestly, that is, maybe you hit a terrific ball and multiply your investment by 100 in a few months or a few years, or maybe the project falls through and in the end everything is lost.

I'm not going to make you dizzy by telling you that if the platform has such and such a security protocol, it sure does. Who doesn't have one in “e-commerce”?

Everyone claims to be safe until proven otherwise.

In theory, the platform has bombproof security systems based on open source that are also constantly monitored by the community. But you know that's theory.

We don't know what can happen tomorrow.

If you want to follow the latest proposals and vote on them, you can do so on their page snapchat.

Everything about their security protocols is on GitHub, but if you're not a tech-savvy person, you won't know what they're talking about.

Conclusion – Opinion

Without a doubt, we are facing an interesting project.

If it's up there (for now), it's for a reason, and we already know that winners are generally more likely to win in the future (think Amazon, Apple, Google, etc.) .

Therefore, the probability that the project will continue to increase is, say, acceptable.

All this will depend on many things, and it is something unpredictable in a market as explosive and still dark as that of applications. DeFi.

A detail that catches the attention of some is the fact that the project seems to be quite dependent on the initial developer, who is still involved in it. However, his decision to hand over the tokens early meant that many qualified participants were already fully involved. When we speak of a “capitalisation” of several hundred million dollars, and on the rise, it is because the stakes take on a certain form.

Many are betting on the ecosystem, with programmers and some companies in the crypto-startup sector.

Some see potential in it.

I see it too, but as I commented throughout the article, with its great associated risks.

Welcome to the Wild West of DeFi.

This is not a field for the faint of heart.

Like that Barden movie called, “This is no country for old people” (although there will be a few there).