The popular yield aggregator Yearn Finance unveils the version three of one of its core product ‘Vaults’, which is one of the biggest collections of updates in Yearn’s history.
According to the blog post, the goal of v3 is to enhance the three key features of the Yearn Vaults: security, development, and automation.
The Vault v3 will have Junior Tranches which enables riskier strategies and allows users to choose a higher-risk deposit option so in turn higher rewards.
This is a feature that folks with a larger risk capacity may wish to explore, and users can also choose the strategies they want to concentrate on.
V3 will allow each token type to have many vaults, and these vaults will be governed by multisigs that may be shared with partner protocols.
Developers and strategists will have more freedom in delivering code to production with v3. It enhances contract modularization and exposure to different ways to deposit in vaults.
Only the harvest functions are automated in version 2, but in version 3 we’ll be closer to a fully automated vault because additional key functions are now easier to automate using the Keep3r Network.
The vault version 2 used Vyper to code, but Solidity is used in version 3. The v2 system has a smaller development pool, and Solidity provides access to a bigger developer pool, which is required for version 3.
According to DefiLlama, 69% of DeFi code is written in Solidity, compared to 10% in Vyper. Vyper enthusiasts can still use it with v3 modules, which is a benefit.
ERC-4626, a new Ethereum token standard, was created with the help of Yearn contributors. The v3 yield-bearing tokens will be fully composable with any ERC-4626 project.
Token swaps in vaults are done with ySwaps by strategists. ySwaps is being utilized in v3 to increase the gas efficiency of token swaps and other processes, resulting in higher APYs for all vaults.
The time it takes for share prices to rise in v2 harvests is 6 hours, while in v3, the time is dynamic, boosting MEV protection.
Vaults in version 2 had a limit of 20 strategies per vault, this number will be raised in version 3. Because of the enhanced modularity of vault’s processes, it may form stronger collaborations with other protocols.
A lot of DeFi projects are coming out with new upgrades to expand the community and thrive in this competitive industry. In March, lending protocol Aave launched its most powerful version ‘Aave v3’ on 6 networks. The new update enables features such as cross-chain transactions and higher borrowing limits.
