Yearn, the yield aggregator operating in decentralized finance segment, has published impressive first-quarter financial report on GitHub two days back. As per the quarterly report of Yearn Finance, the platform had recorded earnings of $4.88 million for the first-quarter.
Highlighting that the above figures were EBITDA (earnings before interest, taxes, depreciation, and amortization), Yearn Finance has generated earnings of $3.70 million in the first-quarter of 2021, which is considerably higher in comparison to the six months of last year, when it was in operations.
Specifically, Yearn Finance recorded earnings of $3.16 million in March alone, an amount it generated in the six months of operation in 2020.
Obviously, we can’t expect the firm to break records every month. Nevertheless, in January and February of 2021, the DeFi platform generated $528,000 and $1.19 million, respectively.
The report further claims that the yVault product line is the top most revenue generator and stays crucial to Yearn’s primary business. Vaults deploy methods to mechanize the top yield farming opportunities that are available by staking on other covenants. The version 2 vaults rolled out in January have boosted top-line revenue for the reported period.
The yYFI vault posted a huge rise in revenue for March as the covenant incentivized yield farmers to shift to the v2 vault that generate additional income.
In the first-quarter, 36 fresh yVaults were rolled out, including five new v2 vaults. Notably, the y3CRV vault, which comprises of three stablecoins, namely USDT, DAI and USDC, was the most profit yielding vault with $1.10 million in revenue for the quarter.
A comparable report published last year disclosed that two-thirds of the platform’s revenue during that period came from the yUSD vault.
Earlier, Yearn Finance generated money in the form of withdrawal fees using v1 vaults, a portion of which are still functioning. The platform charged 0.5% at the time of withdrawal of collateral.
The fee model was amended with the launch of v2 vaults that eliminated withdrawal fees while adding a 2% administration charge and a performance charge of up to 20%. The platform intends users to pay the highest fees on vaults that record best performance.
The covenant rolled out treasury assets based yield farming in the final leg of February and that has been performing well. Yearn assembled a committee to start earning yields on unused assets stored in treasury with capital received from opening CDPs (collateralized debt positions) on rest of the DeFi covenants, MakerDAO for example.
“yVault revenue was the key driver of adjusted EBITDA [earnings], however, we anticipate Treasury yield farming to contribute an increasing amount of revenue in the future.”
While writing this article, the total value locked (TVL) on the covenant was slightly above $3 billion, as per DappRadar.
