YT (Yield Token) means yield token, representing the right to future earnings generated by a certain asset. It is often launched in projects that offer points for deposits.
Buying YT is essentially converting the principal amount of YT purchased into a certain multiple of deposit funds, and then using these deposit funds to earn rewards and points. YT tokens have a limited duration, and after expiration, the tokens will no longer generate returns, so their value will drop to zero. YT is equivalent to leverage, and the principal is akin to interest.
When will YT be used?
If you don't want to make a large deposit in a particular project but still want to participate and earn rewards and points, you can buy YT. This way, there is no risk of losing the principal.
Also, some projects have deposit limits, like USD.AI, which is very popular right now, and the deposits are full. If you want to earn high points, you can only do so by buying YT.
The mainstream platform for buying YT is Pendle. Let's write a tutorial on buying YT on Pendle using the USD.AI project as an example.
1. Buy XPL tokens on the exchange, then select the Plasma chain to transfer to your wallet, and exchange for USDai tokens in the wallet.
2. Register on the USD.AI project platform at app.usd.ai/i/hxkn7
3. Exchange USDai for YT USDai on the Pendle platform.
app.pendle.finance
4. It will be displayed on the USD.AI platform after the exchange.
This project also has an sUSDai token. The difference between the two is that the points earned from USDai are allocated for new listings, accounting for 70%, while sUSDai is directly airdropped, accounting for 30%.
In addition, USD.AI also has YT on the ARB chain, but it has more than 30 days until expiration. I think the project will take some time to issue tokens, so I switched to the Plasma chain.
Finally, YT tokens can be traded, but their value will decrease as the expiration time approaches until it reaches zero. Therefore, the risk of YT is very high, and you must understand it clearly before buying.
