The cryptocurrency world is changing fast as new digital money systems appear bringing more opportunities for traders. Yearn.finance is another emerging platform, which is much discussed in the most popular news on the cryptocurrency market.
Let’s take a closer look at this new cryptocurrency and find out why experts call it “digital money of the future”. Read about the peculiarities and advantages of this platform.
What is yearn finance?
Yearn.finance appeared on the radars of the financial sector not so long ago: it was launched in July 2020. This period is nothing in comparison to Bitcoin, which exists in the cryptocurrency market for already eleven years, or Ethereum with its five-year presence. At the same time, yearn.finance has already drawn the attention of many crypto investors. Internet users search for information about this platform even more often than the explanation of how Bitcoin mining is defined.
So, what is yearn.finance? It is a “farm” where crypto owners can “grow” their digital assets. To benefit from this “harvest”, users should invest a certain amount of cryptocurrency. In other words, yearn.finance is an independent system, which allows crypto investors to increase their profit.
This platform has been created by Andre Cronje and is based on the DeFi platform, which stands for decentralized finance. DeFi is an inspirational and innovative cryptocurrency space, which opens wider opportunities for the holders of digital money. Users get a big variety of financial tools and applications, the majority of which are built on Ethereum.
Yearn.finance is based on such services as Fulcrum, Aave, Dydx, and others. In other words, it uses these systems to be a conductor to various blockchain products. Moreover, Yearn plays the role of a simple interface that helps users to access the DeFi projects conveniently. It lowers the entrance barrier for crypto users and allows them to get blockchain credits without extra steps.
The majority of people who aren’t familiar with Yearn and, in general, with decentralized finance, ask how to use the Yearn services to make a profit there. Of course, the process may seem difficult for novices. However, if to study the topic, it turns out that everything isn’t so complicated. The documentation provides clear information on how the system works.
A user adds stable coins to the Yearn ecosystem, which are turned into yield optimized tokens. The task of yearn.finance is to shuttle these tokens among other systems, including the already-mentioned DyDx, Aave, etc. This process is necessary for getting the maximum profit. In addition to this, a small amount of tokens is accrued to Yearn’s pool that is available only to YFI tokens holders. As the crypto industry is changing constantly, it has many risks in all projects that belong to it, and yearn.finance isn’t an exception. The main questions are the level of liquidity and changes in the pool.
What is a YFI token?
YFI tokens are the main symbols of yearn.finance. Users utilize it to vote for certain changes in the system protocol and make decisions. Why is it important? Such an approach allows maintaining democracy within the system where every opinion is taken into account. Users earn yCRV for providing liquidity, and YFI tokens help to trade the Curve Finance currency. As you can see, YFI tokens play the most important role in the Yearn products and manage all processes there.
When YFI tokens started to attract much attention from the crypto market participants, they began to search for ways how to earn these crypto assets. One of them, as it has been already mentioned, is the contribution to the yCRV pool. The other method is to swap DAI and YFI for BAL in the Balancer protocol. BAL tokens can be easily exchanged for YFI tokens. If you don’t want to spend time on earning but want to get tokens as soon as possible, you can just buy them on any exchange platform.
Why is YFI’s price so high?
This boom in the price and interest in YFI tokens became unexpected. Cryptocurrency variations continue to appear in the market but not many of them succeed there. That is why the launch of the new product hasn’t become a great event. However, YFI tokens’ value has been increasing gradually, and there are several reasons for this.
Interestingly, initially, these tokens were implemented for voting, not as an exchange tool. However, later, when this digital symbol started to gain popularity, its price began to grow accordingly. Although the Yearn creators have been trying hard to persuade all people interested in this service that the tokens don’t have any value, it hasn’t helped. It seemed that these claims had only a converse effect: YFI token started to increase in price considerably, catching up with Bitcoin and Ethereum. Not so long ago, it had a sharp spike in value – by fifty percent. The reason was the introduction by Binance, which made it even more appealing. Another service that has “advertised” Yearn tokens is Uniswap. It has added them to its list.
Nonetheless, not only mentions on popular platforms have influenced the value of these crypto-assets. The Yearn products were successful and profitable enough to draw the attention of the market participants. High returns in the yearn.finance system have shown that this project has all chances to be at the top of the crypto hierarchy.
Moreover, the limited availability also creates intense interest in the product. In the case of YFI tokens, the situation is the same. There is a very limited number of these digital assets available in the crypto ecosystem – only thirty thousand tokens are in circulation now. That is why it isn’t surprising that the agiotage around them is very high, which reflects on its price as well.
At the same time, the yearn.finance founder criticizes people who get involved in the service without investigating and understanding its, at least, essential features. In his recent interviews, he says that users should approach contracts cautiously. The only contradictory thing here was that Cronje didn’t create a test platform where users could test services but without losing real money.
YFI coin: price prediction
The current price of a YFI token is more than sixteen thousand dollars. The value growth indicates that this Ethereum-based token has opportunities to leave BTC behind for a long period, although Bitcoin price prediction has a positive tendency as well. On the one hand, not only a YFI token but also other cryptocurrencies cost more than Bitcoin. On the other hand, Yearn is marked by a high trading volume, which shows significant demand.
Cryptocurrency experts have many disputes concerning the future price. Some of them continue insisting that YFI tokens have all opportunities to increase in value more. Others don’t share their opinion because they predict the decline of interest and demand.
Here is the list of factors that may influence the YFI tokens price:
- Growth tendency of BTC and altcoins.
- Increase in the number of tokens available to users.
- Launch of new protocols.
Why can YFI finance lead the crypto market in the future?
So, what can yearn.finance expect in the future? There are slight chances that the platform will become even more popular by being easy-to-understand for regular people who aren’t familiar with the technology sector. This product can become a good investment and reach a bigger audience if its processes will be simplified.
Yearn is an unusual and new case in the DeFi vertical, and it can become a successful experiment. Of course, the existing protocols may disappear at the nearest time, but the platform will continue operating under all circumstances. Moreover, it will influence the DeFi ecosystem with its changes. There is an opinion that Yearn will be the future of decentralized finance because it is still the most successful story about the cryptocurrency market recently.
The industry gurus have a common opinion that being a very interesting, extraordinary, and exclusive project, yearn.finance will continue to involve more and more crypto traders and even common people who aren’t very familiar with virtual currency. Those who have experience in cryptocurrency operations are and will be impressed by the scale of this platform and its opportunities to expand. Experts are sure that Yearn will become a new page in finances and the market changer.
Many critics say that Yearn is hyping only because of the psychological aspect. Its growing popularity, demand, and everyone’s attention to the project make it “trendy”. This fast-evolving service has made much fuss in the crypto world but what will happen when it ceases? The Yearn founder, Andre Cronje, doesn’t stop adding fuel to the hype around his project by sharp statements about its users and the platform in general. Currently, YFI tokens are the most expensive DeFi-based cryptocurrency in the world due to the fact that its number is very limited. Its stocks may exceed any blockchain stock price in the future.
From a technical point of view, yearn.finance has a lot of chances to get new features and develop in this direction further. According to the prognosis of some industry experts, YFI tokens may be integrated with idle.finance and zkDAI, as well as renBTC.
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