YFI Listing Proposal

yEarn Overview

Yearn.finance (“yEarn”) is a DeFi yield aggregator and optimizer.

yEarn uses a suite of DeFi protocols and primitives including yTokens and delegated vaults to maximize yield.

YFI is yEarn’s governance token. YFI is an ERC-20 token used to vote on yEarn improvement plans (“YIPs”) and new yield strategies for liquidity providers. Token holders can stake their YFI through the governance portal to earn a percentage of fees generated by the protocol.

Background

yEarn was launched in early 2020 and initially optimized yield across Compound, dydx, Aave, and Fulcrum. yEarn has continued to add new DeFi products including yleverage.finance and ypool.finance.

In mid-July 2020, yEarn announced the release of the YFI token. Given the number of configurable parameters in yEarn, the YFI token is used by the community to govern the protocol. There was no pre-mine, sale, or allocation for investors/team. YFI was only earned by providing liquidity.

30,000 YFI tokens were minted and have been fully earned/distributed among the community. The community is currently working with firms such as Delphi Digital and Gauntlet to construct an optimal token model and inflation schedule.

A 6/9 Gnosis Safe multisig has been granted full rights over the YFI governance contract. YIP 40 proposes replacing inactive multisig signers with four new signers.

Since the launch of YFI, yEarn has grown from $8M to over $1 billion in total value locked (“TVL”).

YFI Liquidity Venues

YFI trades on decentralized exchanges including Uniswap and Balancer, as well as centralized exchanges including Binance and FTX.

YFI’s 24-hour volume on Binance currently stands at $17MM across USDT and BTC pairs. On Uniswap, YFI’s 24-hour volume stands at $5.4MM.

YFI Holder Base

Source: Etherscan

Rationale

  • yEarn has one of the most engaged and active communities. This has translated into a YFI holder base looking for liquidity/leverage on their YFI. Compound could become the first DeFi platform to offer liquidity on YFI, further increasing borrow demand and utilization of assets on Compound.
  • Initially, the community may see value in having a collateral factor of 0% to reduce risk to lenders. Additionally, if passed, the borrow limits proposal may help mitigate risk to lenders.

Risks

  • YFI is a relatively new token with a limited track record of volatility and trading history.
  • yEarn multisig and its potential exposure to lenders.

While the community has not recently launched new markets, we see value in starting the discussion around new markets on Compound.

We would like to gauge the community for feedback.

4 Likes

I support this. YFI should definitely be added :slight_smile:

1 Like

What happened with this proposal? Can’t see any replies or discussion or anything.

I think the issue is we need a Coinbase price feed to handle liquidations

Doesn’t that become a limiting factor then? Only coinbase oracle supported tokens can be listed that means.

There are chainlink oracles btw for YFI price. And chainlink is quick to provide price feeds if there is a requirement for a specific pair.

One month later, YFI is now listed on Coinbase Pro, any updates? There is lots of on-chain (and off-chain) liquidity for YFI, so it seems like an interesting candidate for Compound. It’s market has matured since this post was originally created.

Are there people still working on this?

@paraficapital @mrhen unlike other governance processes, the community is able to develop changes to the Compound protocol, and list new assets without a gatekeeper.

This guide lays out the process to add a new market. The steps to add YFI include:

  • Ensuring YFI prices are being reported by Coinbase
  • Deploy a new Open Price Feed view contract that includes YFI
  • Deploy a cToken contract for YFI; this would likely be the generic upgradable ERC-20 cToken
  • Create a governance proposal; this is open to anybody with 100 COMP, using an Autonomous Proposal; this was recently completed by a community member to increase the WBTC collateral factor
  • Gather public support for the change

All of this can be done right here on comp.xyz!

6 Likes

@rleshner it seems Coinbase does not support YFI in their open price feed (current list from their API as of a moment ago below). Do you have any idea what it takes to make that happen? I’d be unsure short of tagging them on twitter! :smile:

  • BAT
  • BTC
  • COMP
  • DAI
  • ETH
  • KNC
  • LINK
  • REP
  • UNI
  • XTZ
  • ZRX

I am here to report that Coinbase Pro has added YFI to its open price feed. So what is necessary to move this process forward. Keep in mind that I am not a coder.

1 Like

I can’t confirm this. I just checked the coinbase pro oracle api and didn’t find YFI: https://api.pro.coinbase.com/oracle

1 Like

I am referring to this: https://api.pro.coinbase.com/products/yfi-usd/ticker

Okay, I see. But this is not the API endpoint, which is used for the price oracle.

1 Like

What needs to happen to get it added to the oracle?

Why do we need Coinbase to add YFI to its open price feed ?
It is not a decentralized oracle :thinking:

1 Like

In fact, the oracle is not really decentralized as the only source is currently Coinbase. This also means, that the Coinbase API is a single point of failure. Beside that, there is no guarantee, that price changes are posted to the blockchain at all, as this is only done by volunteers.

Under the bottom line, I think currently the open oracle is inferior compared to other solutions out there.

It is a requirement for new asset listing.

The compound protocol supports Uniswap V2 as a decentralized fallback oracle in case of any funny business on the coinbase feed.

Is anyone in the community (with the ability to put up 100 COMP for the auto. proposal) interested in this? I think its a good value add for both the COMP and YFI communities.

It is clear there is lots of demand for YFI as collateral (see Maker quickly raising YFI-A debt ceiling from $7M to $20M, and both getting used almost instantly).

I don’t think, that UniswapV2 is used as a fallback oracle. It is just used to define a range for the Coinbase price to be valid.

Like you wrote, it is a requirement, that the Coinbase API delivers the YFI price. As this is not the case, it wouldn’t make sense to create a proposal right now.

Thank you for the correction.

Unfortunate, but I agree. I wish I had any idea what Coinbase’s criteria are for this. UNI was added almost immediately to the price feed it seems, but YFI has been on their markets longer but is still not included.