LayerZero Forum

For a deeper dive into the LayerZero ecosystem and more opportunities join our Forum.

  • Go to page


Fully composable liquidity transport protocol

Core Concept of Beefy

Beefy is a Decentralized, Multichain Yield Optimizer that allows its users to earn compound interest on their crypto holdings. Beefy earns you the highest APYs with safety and efficiency in mind. Through a set of investment strategies secured and enforced by smart contracts, Beefy automatically maximizes the user rewards from various liquidity pools (LPs),‌ ‌automated market making (AMM) projects,‌ ‌and‌ ‌other yield‌ farming ‌opportunities in the DeFi ecosystem.The main product offered by Beefy are our Vaults. The investment Strategies tied to the Vaults will automatically increase your deposited token by compounding arbitrary farm reward tokens from decentralized exchanges back into your initially deposited asset. Despite the inference of the name Vault, your funds are never locked in any contract on Beefy: you can always withdraw at any moment in time.DeFi applications are unique in the sense that they are permissionless and trustless, meaning that anyone with a supported wallet can interact with them without the need for a trusted middleman. While you have funds staked in a vault, you remain 100% in control of your crypto.

How does the protocol work?

  • The protocol involves the transmission of funds through various wallets and smart contracts to deliver on its two core functions: To perform automated yield farming, and to optimize the yield received by users from that process, such that they earn more with Beefy than they would elsewhere or doing the same process themselves (left side); and To reward and incentivize the on-chain stakeholders in the protocol for supporting and facilitating its ongoing operations (right side)

Each of these are described below in How does the yield farming function work? and How does the stakeholder incentives function work?. As described in #what-is-included-in-the-protocol, the protocol can be thought of simply as just the smart contracts which exist on the blockchain to perform yield optimization. These are reflected in the middle row of the above flowchart, and incorporate our Beefy Vault products (comprised of Vaults and Strategies), the Revenue Bridge contracts, the Fee Batch contract, and ultimately our Incentive Programmes and Treasury. However, in order for each of these contracts to function, the protocol is built on top of other external contracts which facilitate the farming process. These contracts are reflected in the bottom row of the above flowchart. If all of the underlying liquidity pools and farms which Beefy is built on were withdrawn and not replaced, Beefy's contracts would still exist, but no real yield or fees would be being generated.

Other LayerZero Projects