CRAZY Yield Farming (YFI) | 600% ANNUAL RETURNS??!!!

decentralized finance yield farming has taken up pretty much over 90% of my time this week because the rewards are just astronomically good. It doesn't make any sense. Specifically, I'm talking about Wi-Fi farming, the token YFI. And when you start farming it, you basically put down some capital, put down some funds, and you're going to get rewards over time. Now, these rewards are crazy. For example, if you're in pool number three right now, you have 609% annual percentage yield. Like what? And this is why there's been so much attention, but there's also a lot of danger involved over here. At the end of the day, I'm not trying to promote this at all, but I'm trying to give you guys an idea of what's happening. This is extremely high risk. And just judging by the eye bags on my eyes right now, you probably know it was very, very stressful for me for the entire week. Now, what exactly is going on? I think this summarizes very well. So someone came on to my Telegram channel and asked, you know, they're interested in this Wi-Fi farming. They want to earn around $50 a day. So that's their target. How much do they need to deposit? And in their mind, they're thinking, oh, do you have to deposit like $50,000 to get $50 a day? I mean, that sounds remotely reasonable. But from the calculations that I did, you literally only need what's $2,906 to be deposited to get $50 a day. So that's kind of the rush people are getting into. I think a lot of people are looking for some reward targets and trying to figure out how to do this. Now, to do this is actually rather hard. And I'll outline some of the basic strategies here, including the three pools that are available, all of them to gain YFI. And at the same time, some of the risks involved, this is definitely not a comprehensive list of all the risks because like anything here, we're growing at a very high speed. And if you just look at the CEO and a CTO, the developer behind all of this, Andre Crony, he literally says, I test in production or prod. That's literally meaning he's testing everything in the live contract with millions of dollars at stake. There's already $760 million at stake here. Whilst that's a great number, I mean, having a lot of number and fun is good, but at the same time, it also paints a big red arrow for hackers to say, hack this, try to hack it because there's a huge amount of reward available. So anyways, I'll talk about what the hell is happening with yield farming in this video, what roughly I am doing myself personally, and discuss kind of the differences between the three pools and some of the governance issues and some notes I have as well. If you guys are interested in decentralized finance, I have a full playlist with everything about decentralized finance here. Obviously, I'm spending so much time on this because it's definitely worth looking into. So check out that playlist. And also, if you want to know how to have a chance to win one of these first runs at a anti-social crypto club shirt and a box mining shirt, make sure you stay till the end of the video. I'll tell you how to win one of these. Okay, let's start off with the very basics. What is liquidity mining or yield farming? Now, we're going to look at the specific case of YFI yield farming, which is the most high return right now at this current point, but this can apply for other coins two. So at the very core, what you want to earn is this token YFI. It's currently valued at $1,104, which is crazy. And the only way that this coin is created is through liquidity mining or yield farming. So this is the only way you can get the coin. There's no pre-mine for this coin. The developers didn't do a pre-sale, et cetera. The only way you can do this is by putting down capital. So this is in a form of either USDT, USDC, DAI, or the other stable coin, TUSD. So by depositing capital, by saving up capital into the smart contract, you're effectively mining this over time. It's being distributed to anyone who does this. So very basically, yield farming has been around for some time. If you look at Y curve, you can see that the pool that we're interested in here is pool number two, the Y pool. So it takes these cryptocurrencies, DAI, USDC, USDT, or TUSD. You save up in there. Typically speaking, this pool will reward you 5% in terms of annual percentage yield. So that's kind of normal. I mean, before this whole financial mess, banks, yeah, did offer around 5%. Now, obviously, zero. But if you look in the brackets, this is what we're interested in. This is the plus 316% in YFI. I mean, that is the rate that's like, boom, mind blown. So if you go to the Y pool and go to deposit section, you can deposit any of these cryptocurrencies, any of these stable coins, rather, DAI, USDC, USDT, or TAUSD, and then click deposit and stake. Then you'll restart your liquidity mining process. So exactly what does this contract do? So once you click deposit and stake, you'll see a bunch of confirmations and contracts that you have to approve on your MetaMask. Just know if you guys have any problems with that MetaMask guide up there. For me, it actually cost me around $15 worth of gas to do so. So just make sure you understand that there is quite a few transactions that you have to approve for this. But regardless, what happens is that it breaks down your input currencies that you have into a ratio of these different stable coins. So that's the ratio here, 3% DAI, 30% USDC, USDT, and TUSD. So what this all means is that if you're saving in a currency, you might incur some slippage. This is just because of the price differences between these stable coins right now. And the percentage depends on which coin you're using. Typically, if you use DAI, you're going to get a positive slippage, which means you're going to have more value for that DAI. And if you use something like USDC or TUSD, then you might have a negative slippage. Another thing to note here is that if you want to check if everything is working, click on the profits. It'll just show you once everything is stayed and successful. You can just check up here the pending Wi-Fi rewards and also the weekly rewards that show up here. I know right now I have nothing in here because I'm using a new account. And the reason for that is I want to protect my own account, the one with funds inside to maximize my protection. Lastly, if you want to claim your Wi-Fi, you can go to the withdraw page on withdraw. A button will show up here for claim Wi-Fi. Just click that. This Wi-Fi will be distributed basically on a minute-wise basis. So long as you have more than 0.1, you can click the claim button. But do know that if you click claim, you do need to spend a little bit of gas. And for me, roughly, I'm spending around $3 worth of gas every time I collect. If you want to learn a bit more about what's happening, I'll give you some of the resources. First of all, on my website, we have a written kind of summary of what's going on here in terms of what it's doing in the background and some of the risks that you'll be taking. And I think the biggest one to highlight here is that generally speaking, Wi-Pool has a higher risk than other products like Compound or Ava because it uses all of them. So in that sense, if the Wi-Pool screws up in any way, form, or the other, or if any of the project that it's investing tokens in screws up, then you're going to risk, you're going to have risk there. It might be that funds can be bled to zero in the case of DAO. So just point that out that everything here is pretty much an experiment. Use it at your own risk. Now, this is where it gets taken to the next level of understanding. This is where I spent most of my time figuring things out. But it turns out there are three pools that you can mine to receive YFI. And the rewards are different. And this is where you have to compare these pools because all these pools have different strengths, advantages, and disadvantages, and also different rewards. So pool number one is the one I just showed you. It's the one where you stake stable coins. Now, pool number two and pool number three have different rewards. And the advantages are here. They basically tell you pool number two, you're using DAI, and you're also using the Wi-Fi token. And pool number three is the governance one where you can have the most advantages, but also you have a high degree of risks. And I'll talk about that later. So if you want to compare the rates, I think if you just want to dive straight to the money, this is where I have to introduce this tool to you, yieldfarming.info. It's built by the community member, Weeb McGee. Sorry if I butcher your name there. But just remember that these things are all community-based. It looks very, very archaic because all the interfaces are just being built right now. But it roughly shows you what's going on. Use out your own risk, by the way. So these are the three pools up here. So you can see the first one is the curve pool that I showed you. And the rate is the lowest. It's around 309%. Then you can go back and hop into the YFI DAI pool. And roughly speaking here, it's at 598%. And then the last pool over here, it's also at 598%. So these two pools have higher kind of percentage yield. It's nearly double that of pool number one, but also you incur a risk. The primary risk that I will say for this is the fluctuation of YFI prices. All of these two pools use YFI token in some form or the other. So if YFI token drops, I'll just call it Wi-Fi token because it's cool. But if Wi-Fi token drops in value, then you're going to suffer a little bit of losses there. It's around 2% exposure to the Wi-Fi token in that sense. But for that exposure, you also get rewarded extra gains. These two pools are both balancer pools. And I'll just show you this one. You actually have a risk warning here. I'll talk about that later as well in the risk section at the end of the video. But these involve balancer where for this pool, for pool number two, you have the Ethereum-based stablecoin DAI and also the Wi-Fi token right here in a ratio of 98% to 2%. So what this pool actually does is it allows people to trade or it helps the trade between Wi-Fi and DAI. So actually, you're actually providing liquidity to that trade. And you can see why the founders of Wi-Fi token want you to do this. They want you to provide liquidity to that transaction so people can trade this more easily. And also, you front up a little bit of the risk as well. Now, what happens is that if you add liquidity to this pool, so you click add liquidity, you can choose to add both Wi-Fi in proportion, or you can choose to add single asset. But keep in mind when you add a single asset, like just if you add DAI, the pool will automatically buy some Wi-Fi in the ratio of 98% to 2%. So you will have exposure to both assets. Just keep that in mind. If you don't know what I'm talking about, check the balancer video up there. I'll explain what liquidity pools are. But once you add liquidity, you're going to have the BPT token from that pool, which you can go to YGov. So you guys go back to YGov to stake that and going to pool number two, you can stake it and also claim rewards from it using the BPT token you got from the first transaction. Obviously, everything here requires you to interact with Ethereum. This means you have two things. One is that you're going to pay quite a bit in fees. So do expect a little bit of fees. And I just took that as a learning cost for this everything I'm doing. And also, if you have a stuck transaction, I have a video here about how to optimize your usage of Metamask. For me personally, when I was doing this, I was using Metamask in conjunction with the ledger. So I have the security of the ledger, but the interactivity of Metamask. So anyways, ledger advanced tutorial up here, if you need to know, if I'm speaking like an alien language, Metamask tutorial up there. Finally, pool number three is also a balancer pool. It's a mixture of the first token that you get, the Y curve token, and 2% Wi-Fi exposure. So the difference is pool number two uses DAI, which is a stable coin. Pool number two uses their own Y curve token, which is generated in this process right here. So if you just generate this, so it's a deposit, but deposit, but without staking, you're going to have that token that you can yet again inject liquidity into balancer. This is the governance token. So technically it has the craziest of all rewards. So what you're going to get with this is not only are you going to be able to stake it and get the rewards Wi-Fi, but you're also going to get rights to vote and you can farm balancer and CRV when that's made available. So it's kind of like the one to rule all. So once you're in pool three, you're allowed to vote and you can vote for or against proposals. As you can see, it's pretty experimental. You only see the proposal ID up here and you want to go to, uh, the yield farming info and go to the government's proposals and they'll tell you what the proposals actually mean. So now you can start voting on what everything is going on and what's doing. Um, it's important to remember actually that proposal one, um, actually votes on if there's any more Wi-Fi tokens to be released. So currently at this point, there's only 10,000 Wi-Fi as reward allocated to each of these pools and it'll end towards the end of this week, early next week. So after that, if proposal one doesn't pass, that means that for the time being, there's not going to be any more. That being said, proposal can be generated at every single time. And there's people trying to propose new ways to distribute Wi-Fi, but these votes are quite substantial and it kind of affects the whole Wi-Fi community in that sense. And this is why it's very important to vote. That being said, of course, if you do vote, you will experience a three day lock on everything. So if you have money staked into the government's contract three and you do choose to vote, then it will lock in those funds for three days. You can't pull them out anymore. So just keep that in mind. That's one of the risks associated as well. Now, I think this is a pretty mind overload. I was thinking for the longest time how to dumb it down. And I don't think I really can. There's so much going on here. And for me, literally, I spent hours researching what's happening because things move so fast. You're essentially following different tweets to find out what's happening because none of this is really mature yet. It's very experimental and it's on the cutting edge. So I think it's a good point now to just talk a little bit about the risks. For number one risk, it was pretty obvious when I talked about pool number one, when you're depositing money into the wide curve yield farming contract, you're subjected to risk of smart contracts breaking and lends that money out to various projects at compound DYDX, AVA. In that case, if any of thing happens there, then you might be subjected to loss of your cryptocurrency, if not all of your loss of cryptocurrency. Number two risk. So number two risk comes from balancer. So this is a little bit lucky here. So when you put money into balancer, you're actually depositing money into market making. So it uses your money, say, for example, in pool number two, it uses your DAI to market make for this coin for Wi-Fi coin. But one of the risks here was what if someone can infinitely generate infinite amounts of Wi-Fi, then it can bleed the entire market making stack or the whole pot of gold there. So this is covered by Nick Cannon. And it talks about how at one stage, it was fear that it was possible that the founder, Andre Croni, sorry if I can butcher your name, but he could have created infinite tokens and try to flood the market. He didn't do so. And instead, he created a multi-signature wallet and entrusted that to nine different key holders. And six of them are required to collaborate together if they ever want to create tokens. So that kind of covers everything. So pool number one is the one with pure staking, where you just stake your coins from your deposits of curve. And this incurs the least amount of risk in terms of new coins flooding in or in terms of market making or the price of Wi-Fi. You're not exposed to Wi-Fi token at all. Pool number two and pool number three, you are exposed to the Wi-Fi token, but you get additional advantages for each of the pools. And if you ever are interested, just you got to read up on this. This is not something that you can, I don't believe you can learn everything in a 10 minute video. So let me relay a bit about what I'm doing. Yet again, not a recommendation, just personal what I'm doing here. Most of my funds are deposited into pool number three. Reason being is because it has one of the highest yields. I'm greedy. I'm after the fields. And I can tolerate that risk for two things, right? One is the Wi-Fi price moving up and down. I can tolerate that risk and also tolerate the risk of potentially somewhat flooding the market with more Wi-Fi tokens. I'm tolerating that. I also have a little bit in the die pool as well. So pool number two. Reason why is because there's a fluctuation between which pool earns more and previously. So a few days ago, pool number two was actually the most kind of highest rewarding pool. I have roughly around 5% of whatever I'm yield farming in pool number one. I guess just because I'm too lazy to move it out at this current point. Uh, that's pretty much it. I mean, I'm after the rewards after all. Did I vote on governance? Yes. Um, I did vote on the governments, but that means I'm also locked in there for a longer period of time. But yet again, I feel like I might as well get my voice heard at this current point. So anyways, that's my current take on what's happening. Am I earning quite a bit? Yes. But am I really subjected to a lot of risk? Also, yes. I think for quite some time, I had a few nights where I'm just waking up to make sure I'm checking out and make sure everything is okay. So also in terms of what I'm doing with the tokens, I'm mostly just farming this. Um, so any new minted tokens, I just sell straight away on balancer. And in fact, if you guys saw me on telegram, I was pretty much at the start selling it every four hours whenever I got new tokens. Reason being is this is kind of like a mining thing. I just want to lock in some of my rewards. Shameless about that. And I don't really mind just selling it and locking in some of the profits. So this is me at me thing long-term. Do I think it's worth it? I think it's highly speculative what wifi is going to do in the future. And a lot of the proposals have huge amounts of impact. So it depends on if you want to be on that leading edge or not. For me, I'm pretty much as happy like selling it, locking in some of the gains, and then kind of thinking about it. Am I a little bit worried that this is going to end? Yes, it would suck if this ends. I felt like this was a good ride for me, but it could possibly end towards the end of this week as the original 30,000 wifi tokens get distributed. And yeah, that might be it. So anyways, that leaves everything here. So this is probably, this video is probably going to be useless in one week's time. If you guys have any findings, make sure you leave a comment in the comment section below. If you're concerned about anything, yet again, leave a comment in the comment section below. I'm not involved in that project in any form or the other. I'm just using it. And lastly, let's talk about this giveaway. You have a chance to win one of these. Obviously not this specific shirt. We're going to get new ones coming in this week, but it will be the anti-social crypto club shirt. I thought this was kind of fun. I designed this myself. So you'll get a chance to win one of the first batches of the new shirts coming in. To get a chance to win one of these, all you have to do is to click the subscribe button down below, click the notification bell. When new videos like this get released, type hashtag notification squad, and you have a chance to win one of these. We'll do the draws on Monday. Oh, and before I leave, I did what do you want to say? Lastly, as a note, when I tried this out for the first time, I use very, very small amounts of everything just because you want to test it out. It does seem like a huge waste because you're using up gas. You might be using like $15 of gas in one transaction in one go. And you think, oh my God, that's, I'm using more gas than I might be putting in. But at the same time, make sure you're doing everything right. Just do small amounts, test it out first before you know what you're doing. So anyways, that's, that's a huge pointer. If you want more tips and more idea of what's happening in decentralized financing, I have a whole playlist. I'll put it, I'll put it here actually, and you can check that out and get in touch with what's happening. Anyways, guys, thank you so much for watching. See you next time.