Yield Yak 🐃 🥛

📣️️️️️️ Important update on Yield Yak's orderly winddown, including YAK Round 1 Claim which is now live

TL;DR:
- You have 30 days to head to the new Claim page to exchange your $YAK for $WAVAX
- Round 2 runs 14 days and starts after Round 1
- Deposits are disabled across all vaults & strategies and will stop earning yield from December 1st, please withdraw your assets

More Info:
Following the successful DAO vote, Yield Yak is proceeding with its orderly winddown. Below breaks down all the important steps.

Treasury Distribution Has Begun
The first claim on Treasury assets has been prepared and is now available for users to exchange their YAK for their prorate share of Treasury assets. How it works:

• You now have 30 days to redeem your YAK for WAVAX. No exceptions can be made for users who miss the 30-day window, and YAK has no utility once redeemed.

• Round 1 Claim is worth 30,750 WAVAX. A small amount (~$5K) has been kept back for any unforeseen items; what's unused from this goes into Round 2.

• The current conversion rate is based on all 10,000 YAK being redeemed. The actual number of YAK that will be claimed will be less, including the Treasury's 1,600 YAK holdings which won't be participating.

• At the end of Round 1, Round 2 will begin shortly after to distribute the WAVAX that was unclaimed + November fees + unclaimed YAK staking rewards.

• Round 2 values will be recalculated based on your prorate share of the actual amount of YAK redeemed in Round 1.

• Round 2 will last 14 days and will be in early December. No exceptions will be made if you miss this window, so please set yourself a reminder!

Round 1 Instructions:

1. Unstake any YAK balances you have
2. Head to the new Claim page: yieldyak.com/avalanche/clai…
3. Approve the conversion. Note that wallets such as Rabby may raise some warnings given it is a new contract. However, the conversion has been tested and is working as expected.
4. Claim your share: you will receive your WAVAX amount and your amount of YAK will be recorded for Round 2 calculations.

Yak NFTs For Claim Participants
Call us nostalgic, but we will be (finally) distributing the suite of Yield Yak NFTs as an honorarium for users who participated in the claim (and held YAK this entire time). If you participate in Round 1, you will be airdropped a Yak NFT when Round 1 finishes.

Product Updates
YAK Staking Rewards have ended and you must claim any pending rewards prior to the end of Claim Round 1. Any unclaimed rewards will go Claim Round 2 participants.

Deposits have been disabled on all strategies. After November 30th all vaults still stop generating yield (no more rate updates), though users will still be able to use the front-end to withdraw until Q2 2027.

rsAVAX, rstAVAX, and rBTC.b Are Being Deprecated
As part of the winddown, Yield Yak's restaking products built on @SuzakuNetwork are being wound down. Please withdraw from these vaults.

sSUZ will continue with ownership of the product transferred to the Suzaku team who will manage it going forward.

Website Updates
YY's homepage (yieldyak.com/avalanche/) has been updated to explain the full timeline of the wind-down and notices put up across all products encouraging withdrawals 🫡.

ICYMI: the distribution of Yield Yak's Treasury to $YAK holders has begun with 30 days to make your claim.

Full details 👇

A proposal has been put forward by Core Contributor @ravageur77 which, if approved, would lead to an orderly sunset of the Yield Yak protocol later this year. Below is the full proposal for transparency.

Protocol operations continue as per usual during this process.
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Proposal for an Orderly Sunset of Yield Yak

TL;DR

- We propose an orderly sunset of the Yield Yak protocol. If agreed on, the Treasury (minus winddown costs) will be dispersed to YAK holders.  Claim #1 would  begin in early November,  followed by a second and final claim in December.

- All Vaults and Farms would move to withdrawal only by November.  Vaults will be maintained and remain yield-bearing until December, after which deposits in underlying Vaults (aiAVAX, aiUSD, aiBTC, etc.) will no longer earn yield.

- Yield Yak’s front-end will be supported until at least Q2 2027, after which any withdrawals would need to be made via Block Explorer

- The Treasury is currently valued at ~$290,000 USD that will remain yield-bearing until the claim period.  The Treasury is currently in a mix of USDC and AVAX, but would be consolidated into AVAX prior to the claim.  YAK holders would burn YAK to receive AVAX during the treasury distribution.

- The Treasury has pulled all of its liquidity for YAK liquidity ahead of this proposal.

REASONING

Launched in the defi summer of 2021, Yield Yak has had an incredible run as one the longest running community-rooted defi protocols on Avalanche. The protocol survived multiple bear markets, and experienced incredible highs, notably YAK being the most valuable airdrop in Avalanche’s history, and reaching $750 Million in Deposits back in late ‘21.  Yak Swap, our 100% free swap aggregator, has turned over billions in swap volume. And for the majority of the protocol's existence, Yield Yak has returned 100% of fees to YAK holders.   However, the protocol has struggled to grow in the past 18 months, notably:

- Chain expansion proved difficult to acquire new users and ultimately unsuccessful

- We failed to convince Avalanche institutional partners (DATs, among others) or the Foundation to support Yield Yak's flagship vaults (notably aiAVAX, despite its position as the highest yield AVAX vault in the ecosystem).  Our fee generation has relied on organic support from the community.

- The regulatory outlook for curated vaults isn’t promising, putting smaller protocols like ours in a potentially increasingly vulnerable position from a risk POV.

- $YAK holders currently receive 30% of revenue.  It has been considered to move this to 0% and 100% to Treasury to bridge the gap between burn & revenue, but this felt unfair to YAK holders with no clear growth drivers in the pipeline.

Ultimately, it feels like the right time to sunset the protocol and also in the best interest of YAK holders as opposed to a slow drain of the Treasury.

SPECIFICS

Treasury

- Burn is currently $9.5K/month, but this is after already making reductions in recent months to bridge the gap with revenue.

- Treasury revenue sits at approx. ~$5K/month

- Treasury is currently made up of 3 assets: $AVAX (in aiAVAX),  $USDC (in aiUSD), and a Pharaoh xPHAR position which stems from an original investment Contributors made back in 2023. What is proposed is that the AVAX and USDC will be consolidated into AVAX, which would be currently valued at ~$290K. The xPHAR position will be transferred to the remaining Team Operations / Contributors to compensate for winddown costs.  In this way the Treasury dispersion can be simplified into one single token, without needing to liquidate and burn half of the value of the xPHAR position. 

Timeline should this proposal go forward.

Late October:

- Deposits are disabled on all Vaults and Farms

- Revenue configured to go 100% to Treasury (so they can be collected to distribute to YAK holders in Claim #2; see below)

Early November:

Claim #1 goes live.  This claim will be calculated as “Current Treasury Assets divided by YAK in distribution minus certain specific wallets (including the Treasury).  The Claim will be live for 30 days from the point of creation.  Any unclaimed assets will be distributed in Claim #2 to users who partook in Claim #1.

Early December:

- Remaining Contributor salaries are halted

- Vaults deposits will stop earning users yield

- Claim #2  goes live. This claim will be for unclaimed assets from Claim #1 + Revenue earned by the Treasury during Claim 1. Eligible wallets for Claim #2 will be wallets who participate in Claim #1.

Not before Q2 2027: Yield Yak front-end may no longer be supported, in which case withdrawals would need be made via Block explorer

aiBTC Stream Finance Impacted Users: 
Contributors will facilitate any aiBTC compensation from the Stream Finance incident should a resolution come to pass in the future.

Next Steps
Community questions & discussion, followed by a DAO vote on Snapshot
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Our flagship aiAVAX vault has been opportunistically grabbing cheap $sAVAX off the market this past week….which means the carry trade has been ripping…which means depositors earned 14% in the last 7 days. 🫡

sAVAX rate update just dropped which means it's a good time to check-in on aiAVAX performance.

Last 7 days: 9.66%
Last 90 days 10.6%

Still the best single-asset avalanche-2:native vault out there 🫡