How To Buy Yearn.Finance (YFI)?

A common question you often see on social media from crypto beginners is “Where can I buy Yearn.Finance?” Well, you’ll be happy to hear it is actually quite a simple and straightforward process. Thanks to its massive popularity, you can now buy Yearn.Finance on most cryptocurrency exchanges, including Coinbase and Binance in 3 simple steps.

Step 1: Create an account on an exchange that supports Yearn.Finance (YFI)

First, you will need to open an account on a cryptocurrency exchange that supports Yearn.Finance (YFI).
We recommend the following based on functionality, reputation, security, support and fees:

In order to sign up, you will need to enter some basic information, such as your email address, password, full name and, in some cases, you might also be asked for a phone number or address.

Note: On specific exchanges, you might need to complete a Know Your Customer (KYC) procedure in order to be able to purchase cryptocurrency. This is most commonly the case with licensed and regulated exchanges.

Step 2: Deposit funds into your account

Many cryptocurrency exchanges will allow you to purchase Yearn.Finance (YFI) with fiat currencies, such as EUR, USD, AUD and others. Furthermore, they will also provide you with multiple deposit methods through which you can fund your fiat account, such as credit and debit cards, ewallets or direct bank transfers.

Note: Some payment methods will have higher fees than others, such as credit card payments. Before funding your fiat account on your chosen exchange, make sure to do your due diligence to find out the fees involved with each payment method to avoid unnecessary costs.

Step 3: Buy Yearn.Finance (YFI)

This process is similar across almost every cryptocurrency exchange. All you have to do is find a navigation bar or a search bar, and search for Yearn.Finance (YFI) or Yearn.Finance (YFI) trading pairs. Look for the section that will allow you to buy Yearn.Finance (YFI), and enter the amount of the cryptocurrency that you want to spend for Yearn.Finance (YFI) or the amount of fiat currency that you want to spend towards buying Yearn.Finance (YFI). The exchange will then calculate the equivalent amount of Yearn.Finance (YFI) based on the current market rate.

Note: Make sure to always double-check your transaction details, such as the amount of Yearn.Finance (YFI) you will be buying as well as the total cost of the purchase before you end up confirming the transaction. Furthermore, many cryptocurrency exchanges will offer you their own proprietary software wallet where you will be storing your cryptocurrencies; however, you can create your own individual software wallet, or purchase a hardware wallet for the highest level of protection.

For more in-depth instructions, our ‘Absolute Beginner’s Guide To Cryptocurrency Investing‘ will take you through the process step-by step. In addition to providing instructions for sending and receiving your cryptocurrency.
And if you’re completely new to crypto our beginner, intermediate and advanced level articles will get you up to speed with everything you need to know about the cryptocurrency space starting out. 

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What Is Yearn.Finance (YFI)?

Yearn.finance is an aggregator service for decentralized finance (DeFi) investors, using automation to allow them to maximize profits from yield farming. Its goal is to simplify the ever-expanding DeFi space for investors who are not technically minded or who wish to interact in a less committal manner than serious traders.

Users earn YFI tokens by locking cryptocurrencies in yearn.finance contracts running on the Balancer and Curve DeFi trading platforms, using the yearn.finance platform.

In this way, yearn.finance capitalizes on a practice commonly called “yield farming,” in which users lock up crypto assets in a DeFi protocol in order to earn more cryptocurrency. The more assets users lock in a platform, the more tokens they are awarded by the protocols.

Launched in February 2020, the service, formerly known as iEarn, has seen huge growth in recent months as new products debuted and developers released in-house token YFI. In its first month of operation, the yearn.finance platform attracted nearly $800 million in assets, making it one of the fastest-growing DeFi projects to date.

How does Yearn.Finance work?

Yearn.finance is a protocol designed to deploy contracts to the Ethereum blockchain as well as other decentralized exchanges running on it, such as Balancer and Curve. 

In this way, users are trusting that YFI’s contracts, as well as those in associated contracts on Balancer and Curve, will deploy on Ethereum in order to provide the advertised services.

Lending and Trading on Yearn.Finance

The majority of yearn.finance’s services – Earn, Zap and APY – seek to enable users to lend or trade their cryptocurrency. 

Earn is a way for users to get the best interest rate on lending, and it works by searching across different lending protocols, such as Aave or Compound, to find the best rates. Users can then deposit their DAI, USDC, USDT, TUSD or sUSD on the yearn.finance platform to receive those interest rates. 

Likewise, Zap allows users to complete several investments with one click. For instance, a user can trade DAI for yCRV (another DeFi cryptocurrency) in one action, compared to three actions across the yearn.finance and Curve platforms. 

This saves the user time, opportunity cost and transaction fees. 

APY (which stands for annual percentage yield) searches across the lending protocols that Earn uses, and gives the user an estimate for how much interest they can expect to earn, on an annualized basis, for a certain amount of capital. 

yearn.finance Vaults

Vaults are yearn.finance’s most complex service, which allows users to follow active investment strategies using the platform’s self-executing code. In this way, Vaults are like actively managed mutual funds. 

Still in its experimental stages, these strategies are expressed in Solidity, meaning a user will need some familiarity with code to understand how the Vaults operate. However, investing in a Vault is straightforward. yearn.finance’s user interface allows a user to deposit popular coins such as DAI and USDC in each strategy, with each strategy displaying its historical return on investment.

Who Are the Founders of Yearn.Finance?

Yearn.finance is the brainchild of Andre Cronje. After leaving the iEarn project in February 2020, Cronje returned to oversee a rebirth, with new tools emerging and YFI going live in July. Since then, its fortunes have turned around, with assets under total value locked coming in at just over $1 billion as of the end of September 2020.

Cronje has a long career in cryptocurrency and has become synonymous with DeFi in particular. He also has positions at smart contract ecosystem Fantom and CryptoBriefing, a resource dedicated to initial coin offerings (ICOs) and crypto media.

What Makes Yearn.Finance Unique?

Yearn.finance set out to simplify DeFi investment and activities such as yield farming for the broader investor sector. The platform makes use of various bespoke tools to act as an aggregator for DeFi protocols such as Curve, Compound and Aave, bringing those who stake cryptocurrency the highest possible yield.

New features continue to be rolled out, these aiming, among other things, to help preserve the long-term value of the platform.

Yearn.finance makes a profit by charging withdrawal fees, currently 0.5%, as well as 5% gas subsidization fees. Due to its governance model, these can technically be changed by consensus at any time.

The target market for yearn.finance is investors who do not have the time to study the increasingly complex DeFi phenomenon from scratch, or who wish to optimize their returns. 

Yearn.Finance development updates in 2023

Yearn.Finance, known for its pioneering role in the decentralized finance (DeFi) space, has had a noteworthy year in 2023 with significant developments and innovations. Here’s a comprehensive overview of the major updates and events for Yearn.Finance in this year:

• Introduction of Ether Liquid Staking Product: One of the standout developments for Yearn.Finance in 2023 was the introduction of a new product related to Ether liquid staking. This product is designed to give users exposure to a basket of liquid staking derivatives (LSDs) through a single token. This move indicates Yearn.Finance’s commitment to expanding its offerings and staying at the forefront of DeFi innovations​​.

• Token Performance and Market Dynamics: The YFI token experienced a significant surge in its value, rising by as much as 39% in a single week. This increase in value was also accompanied by a substantial rise in trading volume. The price of YFI jumped from around $7,200 to more than $10,000, reaching levels not seen since the previous year. This price movement underscores the dynamic nature of the DeFi market and the substantial interest in Yearn.Finance’s offerings​​.

• Proposal for Tokenomics Change and Community Involvement: Yearn.Finance proposed a change in its tokenomics, which was put to a community vote. This proposed change involves a four-phase rollout plan to alter the project’s tokenomics. The new model is expected to change the governance format of Yearn.Finance and further establish YFI as the fundamental foundation for governance. This development highlights the platform’s community-driven approach and the importance of decentralized governance in the DeFi sector​​.

• Yearn.Finance’s Farming Mechanisms and Diverse Pools: Yearn.Finance offers various ways for users to farm YFI, including multiple staking pools. These pools support different stablecoins and provide users with various benefits, such as exposure to other DeFi platforms and tokens. The farming mechanisms of Yearn.Finance demonstrate the platform’s diverse capabilities and its role in enhancing the DeFi ecosystem​​.

• Future Plans and Community Expectations: As Yearn.Finance is still in its early stages of development, the DeFi community is keenly anticipating what the platform will offer in the future. With ongoing enhancements and updates, Yearn.Finance is expected to continue being a significant player in the DeFi space, offering innovative solutions and maintaining a strong community focus​​.

Yearn.Finance has made significant strides in 2023, particularly with the introduction of new products and the proposal for changes in tokenomics. These developments reflect the platform’s commitment to innovation, community involvement, and a leadership role in the evolving DeFi landscape. As the platform continues to grow and evolve, it is expected to bring more groundbreaking features and opportunities for DeFi users and investors.

Official website: https://yearn.finance/#/home

Best cryptocurrency wallet for Yearn.Finance (YFI)

There are plenty of different crypto wallets available. The best one for you depends on your general trading habits and which provides the most security in your situation. There are two main types of wallets: hot storage wallets (digital) and cold storage or hardware wallets (physical). Both have their pros and cons, and there is not necessarily a right or wrong answer when it comes to figuring out which crypto wallet is best for you.

HOW DO I DECIDE WHICH cryptocurrency WALLET TO USE for Yearn.Finance (YFI)?

Deciding which type of wallet to use depends on a variety of factors, including:

• How often you trade. In general, hot wallets are better for more active cryptocurrency traders. Quick login ability means you are only a few clicks and taps away from buying and selling crypto. Cold wallets are better suited for those looking to make less frequent trades. 
• What you want to trade. As mentioned earlier, not all wallets support all types of cryptocurrencies. However, some of the best crypto wallets have the power to trade hundreds of different currencies, providing more of a one-size-fits-all experience.
• Your peace of mind. For those worried about hacking, having a physical cold wallet stored in a safe deposit box at the bank or somewhere at home, provides the safest, most secure option. Others might be confident in their ability to keep their hot wallets secure.
• How much it costs. It is important to investigate the costs associated with each wallet. Many hot wallets will be free to set up. Meanwhile, cold wallets, like any piece of hardware, will cost money to purchase.
• What it can do. While the basics of each cryptocurrency wallet are the same, additional features can help set them apart. This is especially true of hot wallets, many of which come with advanced reporting features, insights into the crypto market, the ability to convert cryptocurrencies and more. Security features can also be a good differentiator.

For a more in-depth overview of cryptocurrency wallets visit our “Cryptocurrency Wallets Explained” guide.

If you’re going to be dealing in larger volumes of crypto, investing in cold storage might prove advantageous.
Most widespead examples of this being the Ledger Nano and the Trezor.

Ledger manufactures cold storage wallets designed for users who want increased security. Their wallets are a physical device that connects to your computer. Only when the device is connected can you send your cryptocurrency from it. Ledger offers a variety of products, such as the Ledger Nano S and the Ledger Nano X (a bluetooth connected hardware wallet).

Trezor is a pioneering hardware wallet company. The combination of world-class security with an intuitive interface and compatibility with other desktop wallets, makes it ideal for beginners and experts alike. The company has gained a lot of the Bitcoin community’s respect over the years. Trezor offers two main models – The Trezor One and Trezor Model T (which has a built in touch screen).