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time to share some personal thoughts on @YamFinance. while i helped launch yam, these thoughts are my own and don't reflect views of yam community or those who assisted in yam launch. ultimately the future is entirely in the hands of the YAM community https://medium.com/@elmoretrent/yam-more-than-a-game-potentially-49664b83254e
i've seen a lot of takes claiming YAM is another garden-variety ponzi game like @SpaghettiMoney or @BasedProtocol –– fun to play but zero-sum.
the game mechanics are really just a disguise, however, for what has the potential to be a novel capital accrual and allocation protocol
the game mechanics are really just a disguise, however, for what has the potential to be a novel capital accrual and allocation protocol
all the hype and memes obscured what was actually a truly novel use of the rebase mechanism –– it wasn't just sleight of hand shifting supply and demand.
YAMs rebase functionality programmatically measures and leverages demand for a very specific purpose: treasury building
YAMs rebase functionality programmatically measures and leverages demand for a very specific purpose: treasury building
and the treasury is powerful. a rough simulation on AMPL's rise with a 10% treasury capture would have led to a treasury over $40M.
while small compared to major DeFi protocols TVL, it could be used to generate legitimate cashflows for the protocol
while small compared to major DeFi protocols TVL, it could be used to generate legitimate cashflows for the protocol
there are basically 5 possible functionalities of the treasury:
1. strategic investments - "decentralized fund" model
2. native financial protocol - eg. money market
3. protocol/org development
4. public goods
5. price floor for YAM
1. strategic investments - "decentralized fund" model
2. native financial protocol - eg. money market
3. protocol/org development
4. public goods
5. price floor for YAM
a mental model that is helpful to conceptualize YAM is a like a decentralized community-owned + governed bank. in trad finance, banks issue shares to raise capital, manage that capital, and ideally generate profit, and trade at some multiple of book value
obviously this not what YAM has done in any legal, regulatory, or functional sense, but it can be a helpful analogy as to a possible endstate if the community so chooses
but its also very possible none of this works, or its not even tried.
but its also very possible none of this works, or its not even tried.
it takes a lot of community governance and effective management. i expect to hear "DAO with extra steps".
there's a LOT of valid criticism for YAM
but zero-sum ponzi game misses the mark by a longshot imo and ignores what could be an amazing DeFi experiment
there's a LOT of valid criticism for YAM
but zero-sum ponzi game misses the mark by a longshot imo and ignores what could be an amazing DeFi experiment