Depositors to the Y Curve decentralized finance (defi) pool have received as much as 2,000% in interest this Saturday, and in total about 600% (pictured) for the entire day, although annualized.
That’s after Yearn Finance released they YFI token to govern the Y pool that runs on the Curve defi platform.
This token has no value whatever, Andre Cronje of Yearn Finance said, and yet the market seems to completely disagree with him.
As soon as the token launched, the assets under management (AUM) in the pool jumped from about $8 million to $100 million.
The interest rate went nuts, from 10% a year to 2,000%, albeit somewhat briefly with these interest rates constantly changing based on supply and demand rather than being fixed.
Y pool has “control mechanisms, configurable fees, maintenance controls, and rules that can be modified. Thus far, these have been managed by us,” Cronje said, adding:
“In further efforts to give up this control (mostly because we are lazy and don’t want to do it), we have released YFI, a completely valueless 0 supply token. We re-iterate, it has 0 financial value. There is no pre-mine, there is no sale, no you cannot buy it, no, it won’t be on uniswap, no, there won’t be an auction. We don’t have any of it.
Earning YFI is simple, provide liquidity to one of the platforms above, stake the output tokens in the distribution contracts (we will provide an interface for this), and you will earn a (governance controlled) amount per day.”
Uniswap is a decentralized broker with many likewise platforms in eth and in quite a few of them people can list tokens by themselves, they don’t need anyone’s permission.
Both YFI and Uniswap confound SEC. The former because nothing is being paid for this token, so there can’t be a security. The second because there is no order book, and therefore it can’t fall within SEC regulations regarding exchanges that trade securities.
Meaning this defi spa...