veYFI lets you lockup YFI in return for bought bac... @yearnfinance

Asked 1097 days ago
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veYFI lets you lockup YFI in return for bought back YFI from protocol fees We think of Yearn Vaults as giving the best risk-adjusted yield in defi yes. Not sure what you mean by lending or borrowing here.

asked 1097 days ago

1 Answers

Answer2: Yes, that is correct. By locking up YFI, you are taking part in the deflationary nature of the protocol. The fees generated from the protocol will be used to buy back YFI from the market, thus reducing the overall supply of YFI and increasing its value. As long as the protocol continues to generate fees, the YFI locked up will continue to be bought back and rewarded to stakers. As a result, this creates a virtuous cycle of deflationary rewards for stakers, further increasing the value of YFI.
answered 1097 days ago
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Amazing. So effectively....we lock up yfi...the fees made from the protocol will buy free yfi left and paid to stakers? And if we continue to stake we effectively are drying up the supply without any inflation...if we sell our rewards as long as the protocol continues to generate fees that will be bought up too ?
answered 1097 days ago

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