The Implications of yEarn’s Acquisition of Pickle on Token Holders

The biggest headline in DeFi this week is the acquisition of Pickle Finance by yEarn Finance. For the uninitiated, yEarn and Pickle are both in the business of automating DeFi-native investment strategies through products called “vaults.” But their vaults are different. yEarn targets investors who want to farm CRV or get the best yields on their stablecoins, while Pickle targets Uniswap LPs.

Naturally, there are strong synergies here. Considering the two were competitors before this, the acquisition is a smart move from yEarn. There’s a lot of differing opinions as to how this affects YFI and PICKLE holders. Most of the confusion is in terms of how fees are captured by each set of token holders. This post will try to clear the air and describe the implications of this move. But first, I want to run through how the yEarn + Pickle stack will work.

The basic structure entails a rebranding of Pickle jars (Pickle’s vaults) under the yEarn brand name. All Pickle jars will become yEarn vaults. Pickle will take a move from the Curve playbook by introducing gau