With DFI.money, investors have a simple shot at the highest possible staking payouts. Investor funds are pooled and deployed automatically, resulting in “high yield profits,” as the aggregator claims.
After a promising first year, the protocol’s total value locked in its native coin YFII has plummeted along with the recent weak market (TVL).
TechNewsLeader and other price predictors have said they think YFII will break free of this pattern shortly, but not everyone agrees. Let take a look at Dfi.money in full.
What Is DFI.MONEY (YFII)?
The major DeFi aggregator platform yearns.finance was forked into DFI.MONEY, commonly known as YFII (YFI).
Released in July 2020, it follows the recommendations of the YIP-8 upgrading plan and seeks to maximize returns for DeFi investors.
DFI.MONEY has updated its protocol and produced some new goods, the Vault being its “killer product.”
YFII is DFI.MONEY’s native token, and it is a fixed-supply token that liquidity providers can acquire by participation in the network.
Users of the Yearn Finance II (YFII) network can farm for the yields of their choice using decentralized financial resources.
Currently, the platform goes by the acronym DFI. Money, and operates as an aggregator to automatically put users’ digital assets to work for high-yield returns.
The Yearn Finance (YFI) platform is a decentralized financial system made real through the Yearn Improvement Proposals, of which the YFII project is a fork (YIPs).
Basically, a fork occurs when a community decides to alter the blockchain’s protocol.
After a community choice was voted down in YIP-8, the YFII For Innovative Investment group was established to prevent “whales” (large manipulators) from ruining the protocol design.
Yearn Finance’s YIP-8 protocol offered a new method of token emission that differs from the previous method and is analogous to Bitcoin’s halving scheme.
The YFII foundation was laid forth in this proposal.
The Bitcoin halving model proposes halving the reward for mining Bitcoin every four years until all coins are effectively mined.
This system is meant to keep a limited supply of the item and prevent its indefinite reproduction.
In a similar vein, the YFII platform suggests a weekly halving approach, in which the number of freshly issued tokens is halved every seven days to ensure a uniform distribution among users.
The Vault is touted as a unique feature for retail traders on the YFII platform.
The YFII Vault is an Aggregator of Farming Pools that utilizes a Suite of Strategy Contracts to help Traders achieve a higher Annual Percentage Rate (APR), a metric used to express the profitability of crypto investments.
Traders essentially farm the incentive automatically by depositing the token offered by the platform.
Using the Vault’s decentralized process, anyone can submit a strategy, and the strategy with the highest votes will be put into action.
The gas or transaction fee traders pay when depositing and withdrawing tokens is another cost the Vault hopes to reduce.
In addition, iTokens, a proof-of-deposit token set, are used in vaults.
Once a user deposits money into a vault, they will receive one of these tokens in exchange for their money.
In financial transactions between lenders and borrowers, proof of deposit is a common verification method.
For instance, a deposit of XY into the Vault would earn an interest of iXY.
Interestingly, the user can elect to directly trade their iTokens for anything they need, rather than having to take the principal amount out of the Vault.
These interest-bearing tokens can be used to secure loans and staked in the DeFi ecosystem.
Therefore, these iTokens aim to secure users’ cash on the YFII platform and make participating in the platform’s activities as easy as possible.
The YFII coin is a community-driven ERC-20 token built on the Ethereum blockchain.
The YFII whitepaper states that there was never an initial coin offering (ICO), a pre-mine, or a token for the development team.
This community token is designed to unlock the agricultural potential of the wide DeFi network.
The YFII token’s primary goal is to make the pool, the only way to acquire YFII tokens, more liquid. The YFII community also uses the token as a means of voting and income distribution within the ecosystem.
Basic DFI.money functions.
- Functioning as YFI (or yearn), it acts as the DeFi. Finance.
- DFI.money, a cryptocurrency, was created to improve and expand the benefits to DeFi investors.
- It finds better uses for the highly valued cryptocurrency, and thus generates higher income.
- It is an alternative version of the popular aggregator platform DeFi. Finance (YFI).
Who Are DFI.MONEY’s Founders?
DFI.MONEY was originally developed as a hard fork of Andre Cronje’s DeFi returns aggregator, yearn.finance.
After leaving the early 2020 iteration of yearn.finance, iEarn, Cronje returned back to continue developing the platform, and its popularity skyrocketed as DeFi gained widespread use.
Yearn.finance’s YFI token mining and farming ceased in July 2020, and a proposal to safeguard liquidity provision against whales received 80% backing from protocol members. However, the required 33% quorum in yearn.finance was not met, so its adoption was thwarted.
Users decided to hard fork the protocol and launch DFI.MONEY with its own token, YFII, as a result.
Following a pattern made prominent by Bitcoin, the hard fork enacted the proposal known as YIP-8, which causes YFII incentives to diminish weekly (BTC).
What Makes DFI.MONEY Unique?
In the DeFi marketplace, DFI.MONEY serves a similar function to that of yearn.finance, albeit with a unique token and distinct protocol.
Users supporting YIP-8 on the previous platform and new DeFi investors looking to maximize returns through liquidity are the intended audiences.
The DFI.MONEY website clarifies that the protocol relies on community support and does not provide commercial incentives like developer rewards.
Users can participate in the Curve (CFI) or Balancer (BAL) liquidity pools and receive YFII tokens in exchange for their liquidity provision.
The Vault, is a new addition to DFI.MONEY, is designed to automatically search for the maximum returns of any token according to user-submitted methods, all without the need for users to set up transactions manually.
How Are YFII Tokens Created?
Token pools are a feature of the YFII platform that generates new tokens by yield farming.
In a nutshell, staking one token into the pool in yield farming earns one token back as a reward.
Thus, this service provides two such pools and benefits from staking CRV and BAL tokens to acquire YFII. Curve.fi’s platform token, CRV, and Balancer’s platform token, BAL, are the respective tokens responsible for platform governance.
By contributing CRV or BAL tokens as liquidity to these pools, you can get YFII tokens in exchange.
How Many YFII Tokens Are There?
The whitepaper states that a total of 40,000 YFII is split evenly between two pools of 20,000 tokens each.
The token distribution is planned to begin with a distribution of 10,000 tokens ten weeks after the platform’s launch.