Yearn Finance has launched stYFI on Ethereum mainnet as a new liquid governance and revenue-sharing token that replaces its previous veYFI system and restructures how protocol revenue is distributed to token holders. The launch implements a major governance overhaul outlined in Yearn’s YIP-88 proposal, moving the protocol toward simpler staking mechanics and a stronger direct link between protocol fees and tokenholder rewards. Under the new design, users stake YFI 1:1 to mint stYFI, which becomes the sole governance token for Yearn. stYFI holders receive time‑weighted voting power that increases the longer they remain staked, and they are entitled to a share of Yearn’s protocol revenue, with a default split of 90% to stYFI stakers and 10% to the DAO treasury. Unstaking is subject to a 14‑day cooldown during which no rewards or voting power accrue, replacing the old four‑year veYFI lockups and aiming to lower the barrier to governance participation. The overhaul also introduces an opt‑in migration path for existing veYFI and liquid locker holders, plus a redemption facility and yield‑backstop program intended to smooth the transition. This change matters because it overhauls Yearn’s tokenomics to emphasize liquid staking, “real yield” from protocol fees, and clearer alignment between tokenholders, vault users, and contributors. By routing most future protocol revenue to active stakers and simplifying lockup mechanics, Yearn is attempting to revitalize governance participation, make YFI’s value proposition more direct, and remain competitive with newer DeFi protocols that have moved toward liquid governance and revenue-sharing models.

AI-generated background, compiled from web sources — not editorial content.

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