![]() ![]() *Having funds in smart contracts always carries some risk.* This isn't to say that it is risk-free, but that you won't have to deal with what is referred to as (). Alternative methods of generating yield, like providing liquidity to a decentralized exchange's () may require you to pair your YFI with another token which could compromise your full exposure to YFI. This section addresses ways that you can make use of your YFI by itself. For more info on insurance feel free to ask in our () in #support. This is because it was not a bug in yearn's smart contracts that caused the loss. ![]() This person having only insurance on Yearn, wouldn't be able to claim any losses and their insurance wouldn't payout in this case. But be sure to read each Defi insurance documentation carefully to know what they do and don't cover.Īs an example, say someone had insurance for their yearn vault, but there was a bug with MakerDAO's code and the vault's CDP lost some funds because of this. DeFi insurance *mostly* covers bugs in the solidity code that leads to a material loss of funds for that specific protocol. ![]() # **Before you start, consider insuring your YFI with DeFi Insurance**Ī note about DeFi insurance and how it works. Interacting with DeFi protocols is **risky**, please do your own research. All positions that take out debt assume borrowing at 70% of the max rate to be able to withstand a 30% reduction in YFI price. In this article, we look into what one can do with their YFI to earn yield in (), what risks are associated with each option, and the approximate yield you could get. ![]()
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