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Most investors lack the knowledge, time, and spare Ethereum to yield farm for themselves. Thus, like with index funds and other “simple” financial products, innovators in the cryptocurrency space have created platforms that automate the process.
Yearn.finance is by far the largest of these products. After YFI launched months ago, capital flooding into the platform en-masse, to the tune of hundreds of millions of dollars. At one point, the platform had over $1,000,000,000 in deposits.
While that number has dwindled over recent weeks, other protocols are picking up the slack.
Harvest Finance just hit $1,000,000,000 in total locked value, making it only one of a select number of DeFi protocols to achieve that milestone. Other protocols that have achieved this include Uniswap, Aave, and Compound.
Harvest Finance locks up $1,000,000,000 in deposits
On Wednesday, Harvest Finance, a yield aggregator that uses a farmer “Chad” as its mascot, joined the select number of DeFi protocols that passed $1,000,000,000 — $1 billion, in other words — in total locked value.
Getting close to 10 digits pic.twitter.com/QMVmEjMrZm
— Harvest Finance (@harvest_finance) October 21, 2020
The number has further been confirmed by DeFi Pulse, a leading data and analytics provider in the DeFi and Ethereum space. DeFi Pulse confirms its data on-chain, suggesting that Harvest actually has at least $1,000,000,000 in locked funds.
This capital is largely locked in the project’s stablecoin pools, which automatically farm Curve DAO Token (CRV), then liquidate those coins for the deposited token. There are also hundreds of millions locked in Harvest’s Uniswap pools, where users can deposit liquidity provider tokens from Uniswap to earn yields and Harvest’s native token, FARM.
Harvest may get a further boost in the near future as Charlie, a Curve Finance co-founder, began discussions with the Harvest team regarding whitelisting its addresses. This may allow depositors in Harvest to leverage Curve’s boosted yields, which should drive investment in this protocol higher.
In the past, DeFi commentators commented that the direction Harvest and FARM are moving in indicates the project may be acting as competition to Yearn.finance (YFI). One analyst in the space said:
“This might be a strange comment but if $YFI has a competitor, then it might be $FARM. Several leagues below of course. But worth looking at.”
Yearn.finance is firing back
Although there are some key differences that suggest Yearn.finance and Harvest Finance are not direct competitors, the former is starting to launch new products and upgrades that should allow it to reclaim some of the yield farming market share.
These include the introduction of a new Ethereum farming strategy, set to go live for public use in the days ahead, along with new strategies for Compound and DAI.
Later, Yearn.finance developers are expected to roll out “Vaults v2,” a dramatic upgrade to its core yield-farming Vaults product that analysts say will bring the protocol to the next level.
The argument that YFI / Yearn value is dependant on crazy yields is missing the forest for the trees.
Yield opportunities continue to grow
Future strategies:
– 10x-100x leveraged short DAI
– Basis/Funding trades
– UNI Farming
– BAL Farming
– L1/L2 Liquidity Bridging
– etc— Andrew Kang (@Rewkang) October 4, 2020