YFDAI — Taking DeFi to the Next Level
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2020 has proven to be a great year for DeFi (decentralized finance). We saw an explosion in interest in decentralized exchanges, loans, insurance, and more.
At one point, finance platform Yearn.finance’s YFI overtook Bitcoin in terms of price. Decentralized exchange Uniswap managed to overtake Coinbase Pro in trading volume. This explosion in popularity forced centralized exchanges like Binance to start offering DeFi-based products and coins.
With no middlemen involved, DeFi projects are able to create financial applications that are highly efficient, decentralized, and can build upon each other.
However, the lack of middlemen also means that users of DeFi services have often been left to fend for themselves when things go wrong. Bugs in smart contracts, hacks, dumping of tokens, scammers, and more have all led many users to lose all their funds.
YFDAI hopes to fix this by offering a full suite of DeFi applications and services that are fully audited, trustworthy, and safe to use, bringing DeFi to the next level.
Here are the YFDAI services that are currently live:
Staking
Users can get up to 72% APR (per year) by staking YFDAI tokens and getting rewarded from a limited pool of 5594 YFDAI tokens.
It is important to note that YFDAI has no minting function, meaning that there is no inflation and no new tokens can ever be created and dumped on the market. Once this pool of YFDAI tokens runs out, rewards will start being distributed in the form of tokens from Launchpad projects.
Farming
Users who lock their DAI, WETH, and YFDAI/ETH LP tokens earn rewards from a limited pool of 1455 YFDAI. A 0.5% fee is charged for withdrawing from the farming pool. They will also earn a share of revenue generated from many other products
Those who farm and hold their tokens for 120 days starting from 15th November 2020 will be eligible for a transferrable YFDAI NFT that entitles the holder to a share of the 0.5% farming withdrawal fee for current farming pools and future Launchpad project pools.
The following services are also planned:
SafeSwap
Uniswap currently allows anybody to list their own token, leading to a large amount of buggy or outright scam tokens being bought by unfortunate traders who end up losing their money
SafeSwap, YFDAI’s version of Uniswap, will screen projects that get listed by requiring them to meet a list of criteria such as smart contract audits, liquidity locks, and token locks. Users of SafeSwap can have some level of assurance that they will not get scammed or rug pulled.
Revenue will come in the form of trading fees. Banner ads placed on SafeSwap will also generate advertising revenue. 5% of revenue from SafeSwap and 25% of ad revenue will go towards rewarding farmers and stakers.
Launchpad
YFDAI’s Launchpad works with promising new projects to ensure they meet standards for getting listed on SafeSwap and provide promotional as well as advisory and development services
Farmers and stakers get access to Launchpad token presales, with larger amounts allocated to those who farm/stake for longer periods of time.
SafePredict
This P2P predictions trading platform will let users win a reward for accurately predicting YFDAI’s future price. A 10% fee is charged to place a prediction, 25% of which will go towards rewarding farmers and stakers.
Lending and Borrowing
Users will be able to lend and borrow funds on YFDAI, with borrowers being charged 1% more than the interest lenders receive.
This 1% different is the platform’s fee, 25% of which will go towards rewarding farmers and stakers.
Additional planned services include a licensed centralized exchange for crypto to fiat exchanges, a debit card, an online marketplace, and much more.
Tokenomics
YFDAI’s token model uses a portion of revenue generated from its various services in order to burn YFDAI. Part of the maximum supply of 21,000 will eventually be burned, leaving a final total of 13,950 YFDAI. This low supply, combined with the deflationary model, should provide some solid buy pressure that only increases if YFDAI becomes more successful.
Liquidity pool tokens have been locked until the end of December 2021.
28% of the total supply is reserved for the team, advisors, development, marketing, and other purposes. The majority of these tokens are locked, with a certain portion being released each month and revealed in monthly Transparency reports. This refreshing transparency from the team as to how their funds are being distributed, should put many investors’ minds at ease.
Team
Unlike many other DeFi projects who choose to stay anonymous, some core members of the YFDAI team have revealed their identities.
There is a good mix of members in different roles, with many getting involved with blockchain sometime in 2016/2017. The majority of them tend to be younger, but this is balanced by the experience of advisor Phillip Dow, who has spent several years working in business development and traditional wealth management.
Conclusion
YFDAI is a very ambitious project, with a large variety of planned services, each of which could be the core focus of a successful DeFi project.
While this may seem overly ambitious, YFDAI has already launched staking and farming, and have also acquired an Estonian exchange and wallet license.
Once SafeSwap and Launchpad are released, this project will have many of the core components needed to serve investors and traders in the next DeFi bull run who are sick of being scammed.
With their attractive tokenomics, ability to receive new project tokens, hodling incentives, and a market cap that’s still quite low, this project has the potential for great rewards for early investors.
