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Tutorial: Yearn.Finance

Yearn.finance, according to its documentation, is a collection of DeFi products that provides features such as yield generation and lending aggregation.

In simpler terms, yearn.finance makes it easy to earn interest on a wide array of assets. It works on multiple blockchains and takes no time at all to start using.

This tutorial will walk you through the steps of connecting to yearn.finance, depositing into its core product, Vaults, depositing into its experimental product, Labs, and changing settings such as slippage tolerance.

 

Tutorial

Connecting your wallet to yearn.finance is the first step after arriving at its website. Start the process from the ‘Portfolio’ home page by clicking on the ‘Connect Wallet’ button in the upper right corner.

For this tutorial, we’ll select MetaMask as our wallet.


Select the account you wish to use with yearn.finance and complete the connection process.

You should now be connected to yearn.finance and see a snippet of your wallet’s address where the ‘Connect Wallet’ button used to be. 

Depositing into a Vault

Before providing liquidity of any kind, you must understand the risk of impermanent loss. You can read Cryptonary’s guide to impermanent loss here.

Navigate to Vaults by clicking ‘Vaults’ on the left sidebar. Once on the Vaults page, you’ll see your current holdings, earnings, and estimated yearly yield. You’ll also see the positions with the highest APY and a full list of opportunities you can deposit into and earn yield.

Now is a good time to note that yearn.finance is a multi-chain dApp. In addition to Ethereum, it also supports Fantom and Arbitum. Each chain has a different list of opportunities. You can switch between networks by clicking on the dropdown labelled ‘Ethereum’ and selecting your network of choice.

After connecting your wallet, select the opportunity that interests you by clicking on the name. You’ll be taken to a new page that shows an overview of the Vault, an about section and the investing strategies employed by that Vault. To make things simple for this example, I’ve selected the ETH Vault.

On the right side of the page, you’ll see the area where you can enter how much you want to deposit into the Vault. Enter your desired amount there and then click the ‘Deposit’ button below. This will open your MetaMask extension to confirm the transaction. 

Note: Yearn.finance features a ‘zap’ mechanic that allows you to deposit into a Vault even if you don’t have the correct token – it handles the conversions for you. If using yearn.finance to deposit a token you haven’t used before, you may have to approve the token first by clicking ‘Approve.’ This will incur an additional gas fee. Learn more about ‘zapping’ here.

Provided you have enough ETH to pay gas fees, confirm the transaction by clicking ‘Confirm’ in MetaMask.

Note: Transactions on Ethereum can take some time to process due to network congestion. Read our section on speeding up a transaction or cancelling a pending transaction in our MetaMask Advanced tutorial if you face any issues.

After the transaction is successful, you should be able to see your new balance on the Vault’s information page and at the top of the ‘Opportunities’ list on the main Vault page.

Note: Depositing can also be conducted right from the main Vault page by clicking ‘Deposit’ on the Vault you wish to use.

Withdrawing from a Vault

You can withdraw your tokens much in the same way you deposited them. From the Vault’s information page, navigate to the ‘Withdraw’ tab.

To withdraw, you must first sign the transaction by clicking ‘Sign,’ which will open your MetaMask extension.

Click ‘Sign’ again in MetaMask. You may have to click the small arrow encircled in red to allow this button to be clicked.

Now, enter the amount you’d like to withdraw from the Vault to your wallet, click ‘Withdraw,’ and confirm the transaction just as you did when depositing. You can click ‘MAX’ if you’d like to withdraw the entire balance.

After a successful transaction, your tokens will appear in your wallet again.

Note: Withdrawing can also be conducted right from the main Vault page by clicking ‘Withdraw’ on the Vault from which you want to remove funds.

 

Depositing and Withdrawing from Labs

Labs are a feature that is only available to Ethereum users as of the writing of this tutorial. It can be accessed by clicking ‘Labs’ on the left sidebar under ‘Vaults.’


These yield earning opportunities are riskier than Vaults according to the disclaimer provided by yearn.finance, so exercise caution when using these and make sure to read about token locking, impermanent loss, and other risks before jumping in.

Depositing and withdrawing from Labs follows a procedure similar to that of Vaults, so refer to the steps above when utilizing this feature.

 

Iron Bank

You may have noticed the ‘Iron Bank’ link in the left sidebar under ‘Labs.’ This feature is separate from yearn.finance and may be covered in a future tutorial.

 

Changing Settings

It’s possible to change a few settings within yearn.finance to suit your tastes. Navigate to the settings page by clicking ‘Settings’ in the left sidebar under ‘Iron Bank.’


There are four settings you can change in yearn.finance: enable signed approvals, slippage tolerance, themes, and language. It’s best to leave signed approvals on for security reasons. 

Slippage tolerance is important when attempting to deposit tokens that have higher volatility and low liquidity. Keep this at 1% to avoid major changes in the expected value of your transactions.

There are four premade themes to choose from in yearn.finance. You can also set the site theme to default to your system settings or create a custom theme.

Lastly, yearn.finance allows you to switch between English and Spanish via the language dropdown menu.

 

Disclaimer: THIS IS NOT FINANCIAL OR INVESTMENT ADVICE. Only you are responsible for any capital-related decisions you make, and only you are accountable for the results.

 

If you found this tutorial useful, make sure to comment and share! Also, let us know what tutorials you’d like to see next!

 

 

 

 

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