Beefy (BIFI) is a decentralized, multi-chain yield optimizer that maximizes returns through auto-compounding strategies across various DeFi protocols.

Open-source DeFi applications aim to be permissionless and trustless, allowing anyone to interact directly without needing trusted middlemen. By keeping all code public and verifiable on the blockchain, users can ensure the safety of DeFi services. These characteristics deliver hundreds of yield opportunities across the ecosystem safely, decentralized through simple interfaces. Beefy is a DeFi Yield Optimizer that helps users earn more crypto assets through auto-compounding, leveraging these decentralized features to maximize returns.

What is Beefy (BIFI)?

Beefy (BIFI) was born in September 2020 when four founders aimed to bring auto-compounding technology from Ethereum to lower-cost chains. The first set of vaults launched on October 8, 2020, on BNB Chain, making Beefy the first yield optimizer. These vaults and strategy contracts maximize user rewards from liquidity pools (LPs), automated market makers (AMMs), and other yield farming opportunities by automatically claiming, swapping, and redepositing rewards for exponential returns through auto-compounding.

Within a year, Beefy managed over $800 million in total value locked and reached a $100 million market capitalization. As new contributors and community members joined, the founding team gradually stepped back, allowing a new generation of core contributors to take over. By the end of 2022, Beefy was live on ten blockchains, expanding to eighteen by the following year. By 2023, Beefy had established itself as a leading cross-chain DeFi protocol, building on hundreds of protocols and deploying the newest and hottest chains and protocols safely and efficiently.

The Beefy Partnerships Team, led by key members such as Weso, Frondoto, and Zapmore, manages relationships with various partners, from blockchain and decentralized exchange partners to wallet integration and insurance partners. Beefy continues to bring yield optimization to new chains, including Polygon and Harmony, solidifying its position as a one-stop app for yield farming across multiple networks.

How Does Beefy Work? Beefy Protocol and Vaults

Beefy is a decentralized yield optimization protocol that operates autonomously, leveraging smart contracts on the blockchain to maximize returns from liquidity pools, automated market makers (AMMs), and yield farming opportunities. The Beefy Protocol functions independently of its contributors and supporting stakeholders, ensuring continuous operation even if all human intervention ceases. The protocol’s core is built around live Vaults and associated smart contracts that handle user deposits, execute automated yield farming processes, and distribute earned rewards.

The protocol accepts user funds and optimizes them by performing automated yield farming. This involves deploying funds in liquidity pools and AMMs, continuously claiming and reinvesting rewards to unlock exponential returns through auto compounding. The smart contracts autonomously manage these processes, ensuring user funds are constantly working to generate the highest possible yields. Each time the yield farming process compounds rewards, a small fee is charged on the earned rewards. This fee, paid in the chain’s native token, is distributed to various on-chain stakeholders, including the wallet that calls the harvest function and the strategist who deployed the Beefy Vault.

To keep the protocol operational and accessible, ongoing maintenance and development are necessary. Beefy’s contributor team handles these tasks, which include pausing vulnerable or malfunctioning contracts, performing upgrades, developing new contracts, and maintaining the web application that assists users in accessing smart contracts. They also operate automated systems, such as bots, that trigger profitable compounding events in the vaults. Additionally, the protocol relies on live servers and databases to store and distribute necessary data about its operations.

External services are also built on Beefy’s protocol, extending its reach and functionality. These services include other smart contracts that deposit funds or act as on-chain stakeholders, web applications that direct users to Beefy’s smart contracts, and information services like user dashboards and comparison sites. While these external services are not part of the core protocol, they enhance its usability and integration within the broader DeFi ecosystem.

The Beefy Protocol operates through a streamlined flow of funds and incentives. User deposits are transmitted through various wallets and smart contracts, performing automated yield farming to optimize returns. Stakeholders, including strategists, harvest callers, and tokenholders, are rewarded for maintaining and supporting the protocol. The smart contracts at the heart of the protocol are designed to ensure the continuous, autonomous operation of yield optimization processes.

Source: docs.beefy.finance

This robust and autonomous foundation sets the stage for Beefy’s Vaults, which play a crucial role in the protocol’s ability to generate and maximize user returns. Vaults are specialized contracts that handle the specific strategies for optimizing yields, ensuring that user funds are efficiently managed and continuously working to generate profits.

Vaults

Vaults are the core investment instruments within the Beefy ecosystem, designed to maximize returns through automated yield farming strategies. These vaults utilize specific strategies to manage and compound deposited funds, achieving high levels of compounding interest. By leveraging automation, Beefy vaults save users from manually managing their positions, reducing the countless small transactions and associated gas costs, and saving precious time. Instead of users managing their investments actively, Beefy vaults do this automatically and at a higher frequency.

In a Beefy vault, users earn more of the assets they stake, whether it is a liquidity pool (LP) token or a single asset. For example, staking BTC-BNB LP tokens in a vault will result in more BTC-BNB LP tokens over time, effectively growing the user’s share in the liquidity pool and allowing for more fees and rewards. Despite being called “vaults,” user funds are never locked, and withdrawals can be made anytime. Beefy does not own the funds staked in vaults; instead, it operates as an investment tool to maximize returns through the power of compounding, making it ideal for medium to long-term investments.

When users browse vaults on the Beefy platform, they see the annual percentage yield (APY), which accounts for frequent compounding, as well as the daily interest percentages and the total value locked (TVL) in each vault. The vaults are categorized based on the underlying platform they use to generate revenue, whether through liquidity pools or single-stake reward pools. Each vault issues specific mooTokens to users upon deposit, representing their share in the vault. MooTokens are unique to each vault and serve as an interest-bearing proof of deposit.

Beefy’s vaults are regularly harvested multiple times daily, and profits are automatically reinvested to maximize returns. This process ensures that users benefit from continuous compounding without manual intervention. The performance fees on additional yield are included in the APY calculation, and these fees help support Beefy’s platform, fund its treasury, and reward $BIFI tokenholders.

Source: docs.beefy.finance

In conclusion, Beefy vaults automate and optimize yield farming strategies, allowing users to earn more from their staked assets with minimal effort. The vaults’ automated processes ensure efficient compounding, maximizing returns and providing a seamless investment experience.

Beefy Use Cases

Beefy offers a variety of use cases designed to maximize returns for investors through automated yield farming strategies. By leveraging its decentralized platform, Beefy provides efficient and secure ways to grow crypto assets.

• Yield Optimization for Investors: Investors can deposit their crypto assets into Beefy vaults, automatically managing and compounding yields. This process saves time and reduces transaction costs, allowing investors to earn more from their holdings. The vaults use advanced strategies to reinvest rewards, providing higher returns than manual management.
• Liquidity Provision in DeFi Ecosystems: By staking assets in liquidity pools through Beefy, users contribute to the overall liquidity of decentralized exchanges and other DeFi platforms. This increases market efficiency and stability while generating fees and rewards for the liquidity providers. Beefy vaults optimize these returns by continuously compounding the earned rewards into the liquidity pools.
• Cross-Chain Yield Farming: Beefy supports multiple blockchains, enabling users to participate in yield farming opportunities across different networks. This cross-chain functionality allows investors to diversify their holdings and access more investment opportunities. Beefy’s automated vaults handle the complexities of cross-chain transactions, ensuring seamless and efficient yield optimization.

In conclusion, Beefy provides robust solutions for yield optimization, liquidity provision, and cross-chain yield farming. Its automated vaults and advanced strategies help users maximize their crypto asset returns with minimal effort and reduced transaction costs.

What is the BIFI Coin?

BIFI Coin is Beefy Finance’s governance token, which is used to vote and earn rewards. Its maximum supply is capped at 80,000 units, all already in circulation (May 2024).

The $BIFI token is crucial to the platform’s operations and community governance. Launched in September 2020, $BIFI tokens are dividend-eligible revenue shares that entitle holders to profits generated by Beefy Finance and allow them to vote on essential platform decisions. As the core of Beefy’s protocol, $BIFI facilitates the distribution of platform revenue, which is generated from a small percentage of vault profits. This revenue is distributed to those who stake $BIFI, creating a direct incentive for holding the token.

Following an initial distribution period of approximately two months in Q4 2020, 72,000 tokens were allocated to the community, while 8,000 were reserved for the founding team. By July 2022, all 80,000 BIFI tokens were fully circulated.

$BIFI operates on an ERC-20 smart contract, recording token holdings among the community. It serves two primary functions: project governance and stakeholder incentivization. Holders of $BIFI can vote in Beefy’s Snapshot Space on governance matters at a rate of one vote per token. Additionally, holding $BIFI incentivizes participation in the project, with governance incentives paid through Beefy’s Incentive Programmes. Over time, external use cases for $BIFI have emerged, such as offering liquidity for trading and using $BIFI as collateral for loans, although its primary purpose remains within the Beefy ecosystem.

In 2023, a significant migration moved $BIFI’s base to Ethereum, restructuring the Incentive Programmes and establishing new bridges for token transfer. The migration was implemented to protect user funds following issues with the previous bridging provider. The total supply of $BIFI is capped at 80,000 tokens, all minted to the Beefy treasury for distribution. This supply ensures simplicity and transparency in the tokenomics of $BIFI, with no further minting or burning capabilities.

The $BIFI token is integral to Beefy Finance’s decentralized governance, allowing users to have a say in the platform’s future while earning rewards from the protocol’s performance. By holding and staking $BIFI, users can benefit from Beefy’s revenue and participate in the decision-making processes that shape the project’s development.

Beefy DAO manages the protocol but operates independently, encompassing contributors and community members. While it maintains the protocol, the DAO cannot recover funds lost in immutable smart contracts, highlighting the separation between DAO control and protocol operations.

Source: docs.beefy.finance

Beefy Main Features

Beefy Finance offers a range of powerful features that help users maximize their crypto asset returns through automated yield farming strategies. Here’s an overview of its core components:

Revenue and Incentives

The Beefy Revenue Bridge is crucial for distributing vault fees from deployed chains to the Ethereum Incentive Programmes and Treasury. This bridge facilitates the transfer of assets across blockchains, consolidating fees into batches to optimize gas costs. It wraps native tokens into ERC-20-compliant tokens, maintains the Cowllector’s gas balance, swaps fees into stablecoins, and bridges the tokens to Ethereum. Post-migration, the Revenue Bridge helps aggregate fees efficiently, ensuring consistent rewards for $BIFI tokenholders and smooth operation of the governance pools.

Additionally, the Revenue Bridge includes permissioned functions that allow Beefy’s core team to adjust the workflow, such as changing the preferred bridging solution, stablecoin, swap pool, destination chain, and address. This flexibility ensures that Beefy can adapt to evolving cross-chain bridging technologies and maintain smooth operations across various blockchain environments. The gasless permit approvals further enhance the user experience by allowing transactions without incurring gas fees, supporting the overall health and growth of the Beefy ecosystem.

Source: docs.beefy.finance

Strategies

Beefy strategies are modular smart contracts that direct user funds deposited into Vaults toward liquidity pools and farms to generate yield. These strategies automate the compounding workflow by claiming rewards, swapping them for principal assets, and redepositing them. Each strategy is unique and undergoes thorough testing before deployment. They are designed to respond to extrinsic risks, with functionalities to withdraw funds safely or halt operations if necessary. By automating complex processes, Beefy strategies save users time and transaction fees while maximizing returns from liquidity pools and lending platforms.

Source: docs.beefy.finance

Concentrated Liquidity Manager (CLM)

CLM, Beefy’s liquidity management product, allows users to access concentrated liquidity pools without the complexities of managing their positions. CLM aggregates user funds to lower costs and increase returns. It issues an ERC-20 cowToken to reflect users’ shares in the pooled funds. Concentrated liquidity offers higher yields by focusing liquidity within specific price ranges, enhancing trading fee earnings. CLM automates the process, ensuring users benefit from optimal yields with minimal effort. This active liquidity management technology contrasts with traditional liquidity pools, providing efficient and profitable liquidity provision.

Boost

Beefy Boost enhances user earnings by promoting exciting projects across various chains. When users deposit in a Beefy vault, they receive mooTokens, which can be staked in Boost to earn additional rewards. This service maximizes APY with minimal manual effort. Users can easily track and withdraw their earned tokens, making it a seamless way to increase investment returns. Additionally, Boost partners with various DeFi projects to offer exclusive incentives, allowing users to benefit from new opportunities and further diversify their portfolios. This collaborative approach ensures that users access the best yield farming options.

In conclusion, Beefy Finance’s features, including the Revenue Bridge, strategies, CLM, and Boost, collectively optimize yield farming, providing users with efficient, automated, and profitable investment opportunities across multiple blockchains.

Is BIFI a Good Investment?

BIFI has long been one of the leading protocols in yield optimization, and it is known for its robust and efficient auto-compounding strategies. However, the rise of new protocols has impacted its dominance. Despite this, Beefy Finance remains a significant player, with a total value locked (TVL) of around $249 million at the time of writing. This enduring presence and substantial TVL suggest that BIFI continues to offer value to investors, although the competitive landscape means it is essential to stay informed about market developments and emerging opportunities.

How to Own BIFI?

To own BIFI, you can use the services of a centralized crypto exchange. Start by creating a Gate.io account and get it verified and funded. Then, you are ready to go through the steps to buy BIFI.

News on Beefy

According to what was reported on the official Beefy blog in January 2024, Frax Finance’s V3 update significantly enhances its stablecoin protocol, introducing sFRAX as a staking vault. This new development boosts stability and yield by integrating sFRAX with Balancer’s 4pool, composed of DAI, USDC, USDC.e, and USDT. Beefy Finance’s sFRAX-4pool Vault maximizes rewards by automatically compounding earnings from AURA, BAL, and ARB tokens. This initiative, supported by Arbitrum delegates, offers additional ARB incentives, making it a compelling option for stablecoin liquidity providers.

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