Centered around the values of fairness, transparency, utility, and rapid development, yEarn, an automated aggregator protocol, has become one of Ethereum’s hottest attractions and most promising pillars in 2020.
Currently the fifth-largest protocol in DeFi, yEarn provides easy access automated yield strategies. Among the project’s signature cryptonative products are its Vaults, in which users can deposit an asset and, via various specially-designed DeFi maneuvers, maximize the yield of that asset.
That said, heads turned in the Ethereum ecosystem last week when yEarn launch its highly-anticipated yETH Vault, the first blockbuster ETH-centric yield farming service in DeFi.
How the yETH Vault Works
yEarn’s yETH Vault is certainly a feat of smart contract engineering, but it’s easy to grasp how the system generally goes ’round. A yETH position works like this (and mind you, this is all accomplished through a few easy clicks on yearn.finance):
- A desired amount of ETH is sent into a yWETH vault
- The ETH is deposited into lending protocol MakerDAO
- This collateral is used to back an automated Dai loan via Maker
- The Dai is deposited into Curve to participate in the protocol’s CRV farming campaign
- CRV profits are sold for ETH
The idea here, then, is that users can now easily put their ETH to use to steadily yield farm more ETH. If you’d like a visual sense of how this process works, community member DeFinn recently published an excellent primer graphic.
You’ve voted, I listened. Here it is the “Understanding @iearnfinance ‘s brand new yETH Delegated Vault”.
— DeFinn (@DeFinnTheFarmer) September 2, 2020
Understanding the Risks
The yETH Vault employs a debt-based yield farming model, i.e. it’s underpinned by ETH-backed Dai loans, so the product is inherently risky. It has various layers of risk, too.
– Bad code in yVault
– Bad code in MakerDAO
– Bad code in Curve
– Massive ETH price crash
– Massive Curve-supported stablecoin price crash
— StevenSwap (@Dogetoshi) September 2, 2020
As The Block‘s lead researcher Steven Zheng noted on Twitter this week, the yETH Vault was vulnerable to potential code flaws across three projects and volatility in the cryptoeconomy.
Yet it’s precisely because of the risks involved that many investors abstain from participating, which is why the yETH Vault can fetch APY returns that can be well above +60%.
Doing Well So Far
The yETH Vault hasn’t even been deployed for one week yet, but the service has already attracted in an explosive influx of interest and ETH.
Indeed, within 48 hours of launching,nearly 400,000 ETH — or ~0.35% of the total ETH supply — flowed into the new system as users flocked to take advantage of the unprecedented ETH farming opportunity.
The new @iearnfinance yETH vault absorbed 378k ETH since launching 2 days ago
It also just successfully managed risk during a 25% crash
3 Rebalances were called in the past hour leading to 2.7M DAI paid back to its CDP
Cool validation for the product pic.twitter.com/x32At0P8tq
— Andrew Kang (@Rewkang) September 4, 2020
Moreover, in that same span the yETH Vault came to mint +70 million Dai, or over 10% of all Dai currently in existence. In the process, the vault also became the largest open position in the MakerDAO ecosystem and helped push the Dai price down toward $1, after the stablecoin has been trading above that mark in recent weeks.
215k ETH – $95m
🔱 ETH.MKR.YFI pic.twitter.com/6tY8rO1R4I
— mariano.eth (@nanexcool) September 3, 2020
The yETH Vault launch was so popular, in fact, that deposits to the system were temporarily paused to discourage overly hasty growth.
Deposits to yETH have been paused. ~70m DAI minted. Withdrawals unaffected. We will allow deposits again in the future. For now this is a high enough cap to balance between best profits and best risk adjustment. pic.twitter.com/te0Z2g6z7G
— yearn.finance (@iearnfinance) September 3, 2020
A New Major Force on ETH
The rise of the yETH Vault can apply considerable pressure to the ETH price going forward.
That is to say, the service is going to be consistently buying ETH off the open market, and this buy pressure — which will undoubtedly grow as yEarn and DeFi grow — is unprecedented. Over time it’s possible then that the yETH Vault becomes a major fundamental value driver for ETH.
Yeth vault will bring sell side liquidity crisis for eth just like what happened in 2017 with ICOs
few understand.. pic.twitter.com/QSoFjnn095
— Mad Yorkie (@noBS111) August 29, 2020
Additionally, it’s possible to think of yETH’s positive pressure on the ETH price as a precursor to how the rollout of Ethereum 2.0 starting in late 2020 or early 2021 can similarly lead to a feedback loop of ETH buy pressure.
For example, on September 3rd investor, strategist, and professor Adam Cochran wrote a Twitter thread explaining how this exact kind of feedback is likely coming courtesy of ETH2.0.
In April I wrote a thread on the economic theory on how ETH2.0 will drive prices.
Some maximalists & arm-chair economists complained that wasn’t clear correlation.
— Adam Cochran (@AdamScochran) September 3, 2020
“If this risky loaning, debt based vault, that is in beta and being tested in production, can convince $150M worth of investments in a few days, imagine the inflow that early ETH2.0 will have,” Cochran said.
All Eyes on Ethereum
One Ether now costs more than US$3000. Did you ever think you’d see the day?
You gotta hand it to the crypto markets: in some ways they’re comically predictable. A month ago, Ethereum was everyone’s favourite whipping boy, a bloated, expensive under-achiever that couldn’t even double its 2017 all-time high. Lol what a weakling.
And with competitors like Cosmos, Solana, Polygon and Polkadot nipping at its heels, perhaps this was the beginning of the end for the network that gave us smart contracts, ICOs, ERC-20 tokens, DeFi, yield farming, NFTs and, to be honest, the entire idea that blockchain was a multi-functional and era-shaping technological breakthrough that you ignored at your peril.
How things have changed. On Monday Ethereum blasted through the US$3000 mark like it was barely there, throwing on an extra 15% while it was at it. The network is now worth a shade under US$400 billion, putting it on par with Mastercard and Walmart, and officially making Vitalik Buterin, the 27-year-old prodigy who created Ethereum, a bona fide billionaire. So, is this how the Flippening begins?
Network to net worth
Due to the speed with which things move in crypto, we tend to underestimate some of the metrics that actually speak to a technology’s success. The new shiny thing is almost always more exciting than some dusty old contraption built in the positively prehistoric year of 2015. Did they even have electricity back then?
But Ethereum stands out from almost all other blockchains in that it’s already being used, at scale, by millions of people and companies. While that may seem like Business 101 – get more customers, be more successful – when it comes to blockchain usage is a particularly powerful factor because of the way it harnesses network effects to improve the value of the system itself. Use it more and the whole system becomes more valuable, both financially and practically, for the network’s users, miners, stakers, investors and developers. Oh, and Vitalik, of course.
How far we’ve come
Ethereum’s issue has always been its inability to scale. If you can’t handle hundreds or even thousands of transactions a second, then you’re not really fit for purpose as a global computer. The result for Ethereum has been a year of increasing network congestion and brutally high transaction fees. Yet the fact that so much continues to be built and transacted on Ethereum tells you exactly how strong these network effects already are.
There’s also an increasing focus on three major changes to the Ethereum network due to arrive before the end of the year:
- EIP-1559: Lifts one of DeFi’s major innovations in the field of ‘tokenomics’ by implementing a token burn system on every transaction. You use the Ethereum network, you burn some ETH, never to be seen again.
- Optimism: due for a full launch in July, the Optimism sidechain should significantly improve the speed of Ethereum by leveraging largely incomprehensible processes such as ZK-Rollups and Sharding. It’s already being used by the Synthetix protocol, where it has saved users over $10 million dollars in transaction fees.
- Ethereum 2.0: This is the big one, Ethereum’s transition from Proof-of-Work to Proof-of-Stake. It’s been coming for years, but the importance of the change cannot be overstated. Already more than 4 million Ethereum are being staked on the Ethereum 2.0 contract, offering an insight into how much ETH might fall out of circulation once the entire thing goes live (potentially in November).
In short, Ethereum is just getting started. The price might seem gaspingly high right now, but remember that Ethereum isn’t trying to be Walmart or Mastercard. It wants to be the thing that Walmart and Mastercard are built on – and that’s a prospect worth having a stake in.
CARBON: A perfect avenue for showcasing talent
Creative professionals sometimes find themselves figuring out where to showcase their creations and profit from them.
It’s a tough situation to be in. But with CARBON, the dilemma is lessened.
CARBON creates an avenue that gives creators both a place to show off their talents and a chance to earn money.
CARBON features an ecosystem of a global scale that integrates open finance, fashion, art, music, and non-fungible tokens (NFTs).
One of its objectives is to enable a community that can inspire, support, and reward professionals.
What the CARBON marketplace looks like
As what an ideal marketplace should be, CARBON has a lot to offer, helping emerging brands and artists have a shot even at the highest levels of competition they have to deal with.
Items related to fashion, art pieces, music, and digital assets such as NFTs are offered in the CARBON marketplace. A dedicated team will carefully select these products.
The market will also see exclusive collaborations featuring various artists and brands for physical commodities and digital items that will be dropped on a weekly basis.
As for its audience, they should prepare for a diverse experience brought by a market evolving into a global ecosystem.
CARBON was founded by Chad Pickard who also acts as its Chief Executive Officer (CEO). It is an open finance wallet and super ecosystem that is built for the whole world of fashion, art, music, and culture while also integrating digital assets through NFT offerings.
It has its native token, the $GEMS, and its wallet integrates Neobank functions like the financial technology company Revolut and a non-custodial smart wallet for decentralized finance (DeFi) and cryptocurrencies.
This integration allows users to hold fiat (government-backed) and digital currencies as well as NFTs in a single platform.
The wallet is linked to the market, giving users the ability to directly select items that they desire.
CARBON doesn’t just work as a marketplace where purchases can be made, but also as an avenue where professional creators get to showcase their talents and inspire others to promote their own. It provides them with a winning environment.
How Tokenplace can help crypto traders get the best buy and sell prices
Any seasoned crypto trader knows that the price of a digital currency can vary across different exchanges worldwide.
Thus, one of the basic strategies for investing in digital currencies is to scout for the best buy or sell price and that’s where Tokenplace comes in.
Access to different crypto exchanges via one platform
To take full advantage of the price variance across exchanges, some traders often resort to opening accounts on different platforms. But Tokenplace eliminates this need because the platform allows one to access different exchanges worldwide.
This means that a user will only need his Tokenplace account and password to gain access to the entire crypto market. This is a lot simpler compared to having to main multiple accounts and passwords for other exchanges for different trading pairs.
Tokenplace is basically an online trading platform and exchange aggregator. With its automated order-splitting, orders are automatically broken up to ensure that traders get the best price for every coin they want to trade.
Easy to use and features-packed trading terminal
Tokenplace is also very appealing to newer investors because it is very easy to use. For instance, users will only need to access a single window for their deposits, withdrawals, trading, and exchanging.
The platform can be accessed from both desktop and mobile devices. Tokenplace’s onboarding and one-time registration process are also one of the quickest in the industry.
Tokenplace uses advanced algorithms for its multi-exchange order splitting feature. With this high-tech tool, users can get the best buy and sell price every time they trade.
IMPORTANT NOTE: This is a paid press release, which BitcoinerX has posted as part of a commercial agreement. BitcoinerX is not responsible for producing this content and does not endorse the products or services mentioned. It is the responsibility of the company posting the press release to ensure the material is credible and accurate. BitcoinerX is not responsible for any damage or loss caused to anyone who chooses to use the company, product or services mentioned in the press release. BitcoinerX does not recommend using the information in the press release to form the sole basis of investment decisions.
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