Coinbase Digital Currency Exchange
- Buy and trade LRC and 40+ cryptocurrencies
- Beginner friendly platform with a range of features
- 24/7 customer support & helpline
Finder may earn compensation from partners, but editorial opinions are our own. Advertiser Disclosure
YFI cryptocurrency: How it works and where to buy
Learn more about what Yearn.Finance does, why the YFI token is useful and where to buy it.
YFI is the native token of the Yearn.Finance system.
Yearn.Finance is a DeFi yield farming system, focused on making it easier for users to automatically farm the highest-yields possible with their cryptocurrency.
Disclaimer: This information is not financial advice or an endorsement of cryptocurrency or any specific provider, service or offering. Cryptocurrencies are highly volatile and high risk. Do your own research and seek financial advice before buying. Please check with providers if their services are available in your state.
| Cryptocurrency | YFI |
|---|---|
| Total supply | 30,000 |
| Inflation | None |
| Network | ERC20 |
| Purpose | Governance token |
Read the beginner’s guide to DeFi.
How does Yearn.Finance work?
- Warning: Yearn should be considered experimental, and a work in progress. There is no guarantee that your funds will be safe when using it.
Yearn is a growing collection of DeFi services, intended to act as a simple gateway for the wider DeFi ecosystem.
Its centerpiece is the ability to automatically invest user deposits in the highest-yielding place available in the DeFi ecosystem, through Yearn Vaults.
Users deposit funds into the vault, and those funds are then collectively allocated to the most lucrative yield farming available, and the returns from those are distributed proportionally to users, accumulating to the yTokens users are given when they make deposits.
Yearn can similarly let people make stablecoin deposits straight to the highest-yielding lending platform available, to earn competitive returns on stablecoins.
In addition to the ease of use, this also helps batch transactions to save on Ethereum gas fees.
The service doesn’t come for free though, as performance fees and other costs are extracted along the way. These fees can be paid to YFI token holders as dividends, in an amount the community of token holders agrees on.
What does YFI do?
YFI is purely and simply a governance token. Its holders are allowed to vote on decisions that affect Yearn.
While simple on paper, this can potentially be quite complex and lucrative though, as evidenced by the decision to receive a pay a cut of the service fees to token holders.
And if Yearn becomes a prominent part of the DeFi world over time, other decisions such as support for different assets, and the way returns are paid or reinvested, could have profound impacts on the rest of the market over time.
Yearn encourages YFI token holders to actively participate in governance.
Risks of buying YFI
It’s important to remember that YFI is an experiment and a work in progress. There are no guarantees of a successful outcome, or that the token will remain valuable.
In particular, it’s essential to remember that Yearn is a public, open-source project which anyone can copy at any time. Yearn has many imitators and competitors, and it will continue to have them. Yearn does not have any kind of proprietary technological edge over its competition.
The value of the YFI token is primarily associated with the community that’s grown around Yearn, and is a reflection of people’s confidence in the people who are working on Yearn. This makes it extremely unpredictable and highly speculative.
If you are not completely certain of how YFI works and what its value proposition is, it may be safer not to risk your funds.
How to buy YFI
Here’s a step by step guide to one way of buying YFI. Note that there might be other options available, so you may want to compare cryptocurrency exchanges to find the one that’s right for you.
Disclaimer: Cryptocurrencies are speculative, complex and involve significant risks – they are highly
volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of
future performance. Consider your own circumstances, and obtain your own advice, before relying on this information.
You should also verify the nature of any product or service (including its legal status and relevant regulatory
requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may
have holdings in the cryptocurrencies discussed.
More guides on Finder
-
How to buy Solana (SOL) in 5 steps
Learn how to buy Solana (SOL) with this step-by-step guide and compare various supported cryptocurrency exchanges.
-
How to buy Polkadot (DOT)
Learn more about the DOT cryptocurrency in this beginner’s and buyer’s guide.
-
How to sell Solana in 4 steps
Learn how to easily sell Solana (SOL) by following our step-by-step guide and compare 10+ crypto exchanges. Get started today.
-
Best Portfolio Trackers of 2021
Crypto portfolio trackers are a must to stay on top of your crypto investments. Here’s our list of the standout trackers to consider with pros and cons for each.
-
Review: Celsius Network cryptocurrency lending and borrowing platform
An in-depth review of one of the most popular lending and interest earning platforms in cryptocurrency.
-
Nexo review: Is it safe for high interest returns?
Nexo is a cryptocurrency lending and borrowing platform that offers high interest rates on cryptocurrencies, stablecoins and fiat. We review the features available and look at how safe your funds would be on the platform.
-
How to buy Bitcoin (BTC) in the US
Want to buy bitcoin but don’t know where to start? This comprehensive guide provides step-by-step instructions on how and where to buy BTC in the US.
-
What is Compound Finance?
We explore how to use Compound Finance for lending and borrowing.
-
Ethereum creator donates 50 trillion SHIB to help battle COVID-19
Vitalik Buterin transferred more than $1 billion in SHIB to charity, but… what is Shiba Inu?
-
Metamask wallet review and guide
All you need to know about Metamask – the browser extension digital wallet and a user-friendly bridge to the world of Ethereum decentralised applications.
Ask an Expert