Yeti Finance Wind Down

Yeti Finance
3 min readDec 27, 2023

Trove owners, token holders and the greater community please read.

IMPORTANT UPDATE FOR PROTOCOL USERS: (January 24th, 2024)

Active troves will have their collaterals sold and loans automatically repaid on February 4th, 2024. Users can opt out of this automatic loan repayment or have their trove assets sold earlier than February 4th via creating a Discord Ticket. Please read here for the full details. Stability pool and PSM will be unpaused after February 4th.

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From the start, Yeti’s focus was to serve as the best protocol to borrow against a diverse portfolio of assets on Avalanche.

The Yeti team has always believed in this vision, with none of the founders selling any of their tokens and prioritizing security above all.

This past year, TVL and revenue dropped significantly and forced us to make cuts and downsize.

At the same time, crypto became even more turbulent with numerous black swan events and targeted hacks becoming more widespread.

With limited resources, we chose to focus our efforts on maximizing protocol security to protect user funds and be a trusted leader in borrowing.

While we are proud to achieve this goal, we unfortunately didn’t reach the scale required to sustain the protocol long term.

Unforeseen Challenges

Furthermore, a number of unexpected events posed significant challenges to the protocol.

One example was that the majority of YUSD became held by a small number of users. This means a major redemption of the system can take place at any time.

These are complex problems with no clear-cut solutions and made new features risky and expansion difficult.

We deliberated on many different pathways, but ultimately realized winding down the protocol is the most responsible action to maximize security of remaining funds.

YETI Redemption

As a thanks to the community, ~90% of the current treasury can be redeemed by YETI holders. Remaining funds will be used for necessary wind down costs.

The redemption contract can be accessed from now until February 10th unless otherwise stated: https://app.yeti.finance/#/yetiRedemption

Protocol owned liquidity in the Trader Joe LP pool has been withdrawn and the AVAX portion of the pair will be contributed to the community redemption pool.

Tokens being held or allocated to current team members will not be redeemed to ensure all assets go to the community.

Interest Rate Acceleration (Please the Important Update to active troves posted January 24th, 2024): https://yetifinance.medium.com/important-update-for-trove-owners-a01ee530367b

(Outdated) Interest rates on outstanding loans on the protocol will be increased over a 3 month period to encourage trove owners to close their positions and withdraw their deposits.

January 27th, 2024: 7.5%
February 17th, 2024: 15%
March 10th, 2024: 25%

Closing out Existing Troves

The peg-stability module cap has been lifted so users with troves can more easily swap for YUSD to repay outstanding loans and withdraw deposited assets.

Stability pool will stay active and emissions will continue to support liquidations. All other pool emissions will stop.

Exiting

As a friendly reminder the protocol’s disclaimers and ToS have always that those who use the protocol and hold related tokens such as YUSD do so at their own risk.

We want to remind everyone of this again and request users exit promptly as there is never a guarantee of security.

A sincere thank you to everyone for being a part of this journey.

To our partners and especially our community members — this protocol couldn’t have existed without you.

You will forever be a part of the Yeti family 🤍🤍🤍

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