Hash Rate - Ep 026 - Weso and Beefy Finance
What is Beefy Finance?
In this episode, Mark Jeffrey is joined by Weso to discuss Beefy Finance, tokenomics, security, transparency, leveraged yield farming and more.
Read our notes below to learn more.
About Beefy Finance
The founders started it in late 2020 in the BSC network but they left sometime in 2021.
The core contributor team took over the project that consists of 18 team members.
Weso is working on lead developer operations and strategic partnerships.
It is a yield optimizer.
It is a set of automation contracts.
They build on top of other DeFi ecosystem projects.
They’re experts on strategy and automation.
Now on 18 chains.
How it works
Started as an auto-compounder on Binance Smart Chain.
Most of their yield comes from farming and selling protocol governance tokens.
They have vaults that manage farming, compounding and re-investment.
They don’t have lock-ups so users can get in and get out at any time.
Available Yields
It depends if the user is a volatile asset farmer or a stablecoin farmer.
It’s a lot more competitive today so yields are a little bit lower.
Beefy is selling token yields immediately and converting it to stablecoins to realize profits of yields.
Underlying strategies of vaults
Their repo has been forked 350 times.
They’re very isolated to specific yield opportunities.
They’re much more expansive and they do all the LPs.
There’s a possibility of a reward being embedded so they’re able to go and optimize that yield.
Everytime there’s a yield so high that they don’t have a number to put on it, they put on a fire emoji.
Whenever a new protocol launches, they often offer high emission yields that also serves as a marketing strategy which drives TVL, excitement and volume to the protocol.
Tokenomics and Revenue
They have a low ratio in terms of market cap to TVL.
$200M TVL and only $30M market cap.
They have 80,000 token supply.
No more token emissions, so it's like Bitcoin with a fixed cap now.
Their original fee structure was 4.5%.
In June last year, they passed a proposal to increase their fees to 9.5% for sustainability.
3% of the fees go to $BIFI stakers.
0.5% go to vault strategists.
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0.5% - 6% goes to their treasury.
Their treasury fund helps pay for all of their monthly expenses and the rest of it gets to a reward pool.
0.005% to go to the harvest function.
They take a 0.1% fee cut on every withdrawal to avoid bad actors that would enter the vault before the interest distribution, grab the earnings and withdraw their funds.
They burn around $5,000-$10,000 a month.
Their treasury income is around $90,000 a month then they deliver a portion of it to $BIFI holders and stakers.
They get another $30,000 a month from a variety of different sources.
Non-custody and Security
All of their processes including the DAO treasury are non-custodial and handled by smart contract automation.
They have a strict set of guidelines in order for them to actually build on top of other partner protocols.
They look for centralization risks, certain pieces of code that need to be fixed, large token holders that pose a selling risk and more.
They have a timelock.
They use an open zeppelin defender in discord which will then post in their community saying a time lock transaction has been initiated that will alert everybody.
The time delay of the time lock is around 6 hours.
They have multi-sig.
They have very transparent docs that show who are the signers of the multi-sig.
Check out these important links
TODAY’S EDITION IS BROUGHT TO YOU BY TREZOR HARDWARE WALLET
Navigating the waters of crypto is risky; even the biggest CEXs & stable coins can have huge risks…
Act now, click the link below & become your own bank via self-custody.