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Yearn Governance Roundup #12

Week Ending December 13, 2020

Welcome to the Yearn Governance Roundup — a weekly newsletter covering everything in the Yearn Governance pipeline.

Quick Hits

⚖️ Governance Summary

Make sure you join the governance forum if you want to get involved with these discussions!

Active Votes

🗳️ None this week.

Table of contents

Results: Create a YFI Governance Vault

On Dec. 9, the sentiment poll regarding dudesahn’s proposal to create a new governance vault closed. There were three options to vote for:

  1. Merge governance staking into a new Governance Vault. YFI is deposited to Maker to yield-farm with DAI. All protocol fees flow to depositors in this vault.
  2. Create the Governance Vault, but normal staking remains an option. Protocol fees flow to both YFI staked in governance and YFI in the Governance Vault.
  3. Keep things as is. No Governance Vault is created, and the YFI yVault must choose between utilizing YFI for staking or for yield farming.

The votes heavily favored creating the vault, but 30% were in favor of the vault living alongside the existing staking infrastructure instead of merging them.

Remember: This new vault would deposit YFI into MakerDAO to mint DAI, and use the DAI to yield farm. Depositors in this Vault receive governance fees and yield-farming profits, with a part of profits potentially going to support protocol initiatives.

There’s clearly some more discussion to be had, so make sure to continue giving feedback on this change here.

Yearn Governance and V2 Vaults

Vasa (vasa_develop on Twitter) released a visual aid and explainer for the V2 Vaults that are launching soon. As Yearn governance participants, you’re probably wondering where we fit into the mix.

Under normal operation, Yearn governance can:

  • Approve Strategies to interact with Vaults and take on debt.
  • Increase the parameters of a Strategy’s borrowing limit.
  • Migrate a Strategy, and their current capital and debt, to a newer version of the Strategy.
  • Set the Guardian role to another account, without their permission.
  • Trigger the Vault to enter Emergency Shutdown Mode and trigger a divestment from all connected Strategies.
  • Exit Emergency Shutdown Mode.

These functions play a key role in the V2 Vaults implementation and maintain governance as a cornerstone of Yearn’s infrastructure. You can learn more about the V2 Vault implementation here.

Yearn Quarterly Report

Yearn community members have created an informal quarterly report that’s worth a read. I won’t cover the specifics in this newsletter, but here’s a brief overview:

  • Net income for the three months ending Oct. 20 was ~$3.8M, with the majority of revenue coming from yVaults.
  • ~68% of yVault revenue is derived from the yUSD vault.
  • >80% of operating expenses were due to security costs and administrative salaries.
  • Yearn owns several assets valued at ~$581,000 as of Oct.20, with no liabilities.

Bonus: YETI Index Goes Live

PowerPool is a protocol for pooling governance tokens that allows the token holders to lend, pool, borrow governance tokens, get income, and accumulate governance power in protocols based on Ethereum.

They recently launched the YETI Index, which consists of Yearn ecosystem projects: YFI, SUSHI, CREAM, AKRO, COVER, K3PR, CVP, and PICKLE. The weights of the tokens is as follows: YFI 35%, SUSHI 17%, other tokens 8% each.

The governance systems of Yearn‘s partners are independent and users will need to be aware of all ongoing/upcoming votes for each project. All proposals issued in YETI composite protocols will be added into PowerPool governance, allowing users to vote in YFI, SUSHI, PICKLE, etc. using the PowerPool governance layout.

I also encourage YETI holders to subscribe to my newsletter, the Yearn Partner Roundup, to stay up to date with these ecosystems. To learn more about YETI and what it offers, read the announcement here.

💵 Treasury Update

Operations Fund — Dec. 10, 2020

Treasury Vault — Dec. 10, 2020

Governance Contract — Dec. 10, 2020

🗺️ Ecosystem Links

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