My Chads, the rotation from majors to low-caps is starting. $YAM started as a rebase meme coin, but has transitioned into a full-fledged ecosystem developing 4 new products. Not many people have realized this big pivot, which means there's still a big upside.

Let me ELI5.

2/ $YAM goes back to the beginning of the DeFi boom in August 2020. It started as a rebase coin inspired by Ampleforth but later realized that a rebase function doesn't make sense for most products and abolished it's rebase function.

3/ Instead, $YAM focused on its key strengths:

- A strong development team
- An active community
- A large treasury chest to support an ecosystem.

Combining these strengths, it's currently developing 4 new products. Each product will increase the value of the $YAM token.

4/ The treasury chest currently has 4.5M USD which is large for a project with a marketcap of 18M USD. Also, the treasury will be used for buybacks if the treasury ever becomes bigger than the marketcap of $YAM through the "Great YAM Wall" initiative, i.e. a hard price floor.

5/ So let's get to the fun part, the 4 products which are in development at $YAM:

- http://Degenerative.Finance  (Synthetics, in collaboration with @UMA)
- Umbrella (Insurance protocol)
- YAM DAO SET (Portfolio manager, in collaboration with @SetProtocol)
- YAM Factory (incubator)

6/ http://Degenerative.Finance 

Degen Finance is a suite of DeFi derivatives through synthetics. The first derivative launched will be uGAS, which will track and hedge the cost of gas on Ethereum. 10% of the UMA rewards will go to YAM treasury (open to change by community vote).

7/ Degen Finance differentiaties itself from other synthetics platforms like $SNX and $JARVIS by aiming to offer more exotic degen derivatives. As we can see from Binance and FTX (e.g. Trump token), the demand is there for these products, so I like the niche.

8/ Looking at market caps of the comparable products like $SNX, $UMA (obviously as its in collab with $UMA) and $JARVIS, there seems to be room left for $YAM.

9/ The second product is Umbrella, an insurance protocol for (smart) contracts, currently in public alpha. In short, Protection Providers fund a MetaPool in exchange for a funding rate. Protection Seekers buy protection in one of the coverage pools.

10/ The fee income from Umbrella is from arbitration and creation of the Pools. The precise token economics are still being discussed by the Community and how it will benefit the YAM holders (also due to regulatory reasons).

11/ What I like about Umbrella is that it solves a real need in the DeFi space - though the space is crowded. Also, there is no new token for this project. Therefore, all the value will attribute to the YAM token holders and there is no dilution of value by adding a new token.

12/ Below a market cap comparison of the other players in the insurance space $NXM, $NSURE, and $COVER vs $YAM.

13/ Third up is Yam DAO Set (YDS), made in collaboration with @SetProtocol planned for launch this month. YDS will be used by the YAM Treasury of 4.5M USD to decentralize its decision making process of managing the treasury. These will be implemented by a fund manager.

14/ Krugman will serve as fund manager https://twitter.com/krugman25?lang=en and has a good reputation within the space. He was on http://TokenSets.com  as a social trader and apparently was high on their leaderboards (can't verify this currently).

15/ I really like this approach as often treasuries within DeFi protocols are stagnant due to solely on-chain governance, or centralized by the team. YDS provides a good middle way where there is a fund manager (Krugman), but this manager is guarded by on-chain governance.

16/ Furthermore, plans are to allow the public to join the DAO trader fund for a fee, and the fees earned will go back to the YAM Treasury ultimately benefiting YAM holders. The result of YDS will be an active revenue stream. A DAO Treasury Set token is also unique in the space.

17/ In the future, the YDS product will also be used to on-board other DAO's and retail fund managers. This is similar as $MELON and $DHEDGE. See a comparison of market-caps below.

18/ YAM Factory

The YAM Factory is used as an incubator program for new projects. Anyone can apply for a grant and obtain funds from the YAM Treasury. The YAM token holders will decide which projects will be pursued. Currently there is a proposal for an algo stablecoin.

19/ The main thing I like about $YAM is that they seem to have the right vision of operating a DAO:

- Each product will generate value for the $YAM holders (this often is not the case in most DAO's)
- The community is actively involved in the decision making process.

20/ The synergies between the products also could become interesting. E.g.
- Participation in the YAM Treasury DAO Fund as an investor, and receiving coverage from Umbrella.
- YAM Factory incubation combined with Degen Finance listing synthetic and coverage from Umbrella.

21/ Comparing the market cap of $YAM vs the combined average mcap using above spreadsheets:

Avg Syntethics player mcap: 974M USD
Avg insurance mcap: 117.5M USD
Avg Investment Manager mcap: 30M USD
Total: 1.12Billion USD

Marketcap YAM: 18M USD

I rest my case.

22/ The main challenges will be completing the roadmap in time, and ensure that there is enough marketing and partnerships made so that YAM will be an active part of the DeFi community and people will use their protocols. I'm excited to see them realize their roadmap.

23/ For a great overview of the products, here's a picture by Nonstoptheo:

24/ Link to the coin (don't buy the V2): https://www.coingecko.com/nl/coins/yam#markets

Umbrella whitepaper: https://yam.finance/static/media/Umbrella_Protocol_Lite_Paper.223e0066.pdf

Docs degen finance:
https://docs.degenerative.finance/ 

Yam medium: https://medium.com/yam-finance/yam-treasury-quarterly-update-9964a3ca5864