This is a guide on how to buy YFI token from yearn.finance team. YFI is a really interesting DeFi token, which helps regular users utilize the full power of Decentralized Finance (DeFi) tools, including the now famous “yield farming”. This means you can simply own, for example yDAI, and get exposure to all yield farming opportunities from Compound to Balancer while also maximizing your yield in the process.
The YFI token is also interesting in that it is pretty much run and created by a single developer, Andre Cronje. This just shows how much impact a single developer can have on the entire ecosystem and create a protocol worth tens of millions of dollars on other money legos already built on Ethereum.
YFI is gaining momentum because it has proven to be a truly bottoms-up community driven project. There is no pre-mine or pre-sale or VCs or ‘thought leaders’ or other shenanigans. What is remarkable is that Andre, the developer, doesn’t even have any YFI reserved for his own work! That has attracted a lot of passionate community members to become stewards of the project.
After you’ve learned the basics, it is time to start learning how to buy YFI tokens. However, before that, let’s first learn about how to “farm” YFI tokens. Farming YFI tokens may be a better strategy than buying YFI tokens for some people. This is especially true for those who are ‘liquid’ in USD or DAI since most of the pools and farming opportunities for YFI are based on DAI and not ETH.
How to Farm YFI
There are three ways currently to farm YFI –
- On Curve, with the “Y” tokens (original reward completed)
- On Balancer, with the 2/98 YFI/DAI pool (original reward completed)
- On Balancer with the YFI/yCRV pool (reward expires on July 26, 2020)
How to Buy YFI
There are several places you can currently buy YFI via Decentralized Exchanges without account creation/KYC etc.
Centralized exchanges where you can buy YFI are –
Balancer has a pool that is being used to farm YFI, so there seems to be higher liquidity there. If you want to buy large amounts of YFI, Balancer may be a better bet. The downside with Balancer is that the gas price is much higher than Uniswap, almost by a factor of 3x. Therefore for smaller amounts, Uniswap may give better returns including the gas fee.
However, in any case, always make sure to check on 1inch before you buy directly on Unswap or Balancer. This is because 1inch will tell you the best execution for the trade. For example, going from ETH to DAI and then to YFI may be more profitable than buying directly in the ETH/YFI pool or vice versa. Also, the site will include the gas prices in the calculation, so you don’t need to worry about the best execution at all.
Also, 1inch is really good with converting the crypto you have via the best possible execution via multiple decentralized exchanges. For example, here is an example of their ‘Pathfinder’ algorithm – something very hard to replicate manually.
We suggest using DeFi exchanges like Uniswap, Balancer, and Kyber instead of centralized exchanges since you can execute the trade directly from your Web3 wallet like Metamask or Ledger instead of going through account creation, KYC, withdraw limits, etc.
All of these can be accessed via MetaMask. If you have a decent sized crypto portfolio, make sure to use a hardware wallet like Trezor or Ledger, which you can easily connect via MetaMask.