yYFI Vault - Investment Strategy

At time of writing, there is no active investment strategy in place for the yYFI vault.

This topic is to begin a public discussion about putting one in place.

The yYFI vault contains 801.547473619835831598 YFI, valued at $18,137,453.09.


Some strategies to consider:

Borrow+Mine Strategy:

Deposit YFI as collateral on Cream, borrow stablecoin, mine $CRV (or $SWRV)

0.75 (collateral factor) / 2.0 (health factor) * (.71 (crv rewards) - .14 (cream interest rate) ) = 21% CRV

  • Cream rewards (1.7% for lending YFI and 21% for borrowing USDC)

Variants are possible with borrowing different assets or using aave instead of CREAM

Options Strategy:

  1. Sell YFI for DAI and buy 1x long YFI position on PerpetualProtocol

  2. Deposit DAI into vault

Returns: Dai vault returns - Perp 1x long interest rate

Null strategy:

Whenever there is no other strategy, YFI should be deposited in Gov vault to earn Gov rewards

From what the team has said there is a current plan for v2 strategy of the YFI vault, it is just being finalized before being implemented.

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But in order to receive Gov rewards you’d have to vote on proposals right? How will the vault vote?

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Yeah– I would also argue that if holders really wanted to do this when the vault is idle, they could just do it themselves. There’s no withdrawal fee when the strategy is off, and this would be extra code (voting with yYFI) that just isn’t necessary right now– at least not until we vote on allowing non-staked YFI to vote.

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But in order to receive Gov rewards you’d have to vote on proposals right? How will the vault vote?

Delegate to a voter of your choice (I personally would pick @AndreCronjeTech).

This would still require gas + attention. Not everyone has sufficient time/large enough stake to do this.

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Where? Isn’t this where that discussion should be taking place, or is there another forum I need to join?

While the easy answer is that all of this has been on Twitter (I assume, since I’m really only reading about Yearn here or on Twitter), it’s a valid point that not everyone who participates in governance is on there or has the time to follow all of the various Yearn team members. There’s a great newsletter that was just started up last week here that summarizes everything happening with Yearn.

Perhaps we should start posting the weekly newsletter in the “Announcements” section, @tracheopteryx @learnyearn @franklin? This also makes me think that a great subsection of the newsletter would be “Team Updates” or something like that– just to let everyone know what the team is working on. Perhaps also a section specifically on the Vaults, or at least on any Vaults that are currently disabled due to strategy switching.


yfi collateral factor on CREAM is 50% not 75%

I’m pretty sure a delegated yYFI vault strategy is in the works.

YFI > AAVE > stable token loan > curve.fi > yCRV vault > yield buys YFI

This has been discussed before.