The latest in a string of high-level mergers and partnerships to the multi-faceted decentralized finance protocol (DeFi) was revealed this morning by the founder of Yearn Finance, Andre Cronje.
A Yearn Powered Alliance
Cronje stated in a blog post that Yearn would be joining forces with Cover on an exciting range of synergies.
Yearn and Cover Protocol join forces. Providing cover has been a key initiative at Yearn since working with Nexus Mutual to launch yInsure. Yearn developers have been working with Cover Protocol devs since inception, so this collaboration comes natural for both. The two teams working together as one will help optimize, enhance, and amplify the work that is already underway. Yearn can focus on its best-in-class vaults, while Cover becomes the backstop coverage provider for the Yearn product suite, as well as for DeFi as a whole.
Since its inception, Yearn developers have been collaborating with Cover Protocol devs, so this partnership is inevitable for both. The two teams operating together as one can help refine the work that is already ongoing, strengthen, and amplify it.
Yearn will rely on the best-in-class vaults, while Cover remains the supplier of backstop security for both the Yearn software suite and DeFi as a whole.
Yearn’s Acquisition Week
In what was a crazy week for Yearn, The Cover acquisition is only the new. Yearn revealed upcoming ventures with Pickle Finance yield farming protocol, a vault convergence with Argent crypto wallet, and a merger with Cream Finance lending protocol.
The “synergies” described by Andre Cronje include:
Cover provides a wider range of coverage and accepts more types of collateral.
Cover products like perpetual coverage will get an expanded addressable market.
Cover expands into a new cover money market, making the CLAIM token a collateral & borrowable asset.
Yearn gets coverage for vaults and can offer users a reduced risk product.
Yearn can focus on vaults and lending, with yInsure (and yNFTs) being taken over by Armor.
YFI cover writers earn increased fees from YFI coverage underwritten.
The acquisitions are notable for how both Yearn’s core competencies are strengthened while simultaneously moving the protocol towards emerging vertical and horizontal growth markets. As one of Ethereum’s most popular set of decentralized apps, Yearn is positioning itself for the future as DeFi continues to grow.
“For Yearn’s vaults, Cream and Pickle would allow superior performance, while Cover grants a new product line to the protocol (Cover members insist that they do not sell insurance” such as yInsure, but “cover” instead).
However, there is certain complexity about each ‘acquisition’. Although Cronje’s blog posts define Cover and Cream’s work as “mergers,” senior developer Banteg noted on Twitter that the Pickle announcement is a “developer collaboration,” and was characterized as a “symbiotic relationship” by the official Yearn Twitter handle.
Another one for the books. What are your thoughts on Yearn’s “mergers”?
