Decentralized finance or DeFi is the talk of the town, and it is not difficult to see why. According to DeFi Pulse, the total value locked (TVL) in smart contracts went from around $66 million in 2018 to $54.55 billion as of writing this. Thanks to this skyrocketing growth, even the traditional investors are entering the Destructured party.
Among all the DeFi widgets, farming is amongst the most preferred ways to earn passive income. Why? Because Compound, a platform that provides farming and much more, accounts for over 19% of the TVL of the DeFi space. This speaks volumes of farming popularity.
As for yield farming, it refers to earning crypto in return for providing liquidity. Simple, isn’t it? Not at all!
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Due to increasing competition and tons of farming pools, it has now become a nightmare to find the best pools for higher returns. On top of this, you need to devote hours manually searching and managing your farming portfolio. All of this makes the taste of yield farming profits a bit bitter.
What if I tell you that there exists a platform that makes yield farming much easier and at the same time more rewarding?
In this post, we will discuss just that! Keep reading.
Understanding YieldFarming, The Hottest DeFi Investment
The reason why you keep hearing about ‘liquidity pools’ is yield farming. At the simplest level, farming is putting your crypto assets in a liquidity pool with an aim to bank the highest profits possible.
Let’s understand how does yield farming works.
In centralized exchanges, there is a seller and a buyer; essentially, liquidity is primarily governed by supply. The same is true for decentralized exchanges (DEXes) but with a significant change. Unlike centralized exchanges, there is no central authority facilitating trades in DEXes. Instead, lenders lock their crypto assets in liquidity pool smart contracts and provide liquidity in return for profits. This is where it all begins.
By being a liquidity provider, you earn a fraction of fees on every trade in the pool. But yield farming is moving a step ahead of this. In yield farming, you keep moving assets in the best APY providing pools. Plus, you can also stake what you get after you invest in a liquidity pool.
Yes, say you invested 1000 USDT into Compound. You will receive 1000 cUSDT tokens that represent your share in the pool. You can further put these cUSDT tokens in a pool and earn from there too. This is where the popularity lies; you get a new token coupled with the usual returns.
Yield farming is the best way to put your idle crypto assets to work. Also, yield farmers earn significantly high returns as compared to putting fiat money in a bank account.
Nevertheless, there are some dark spots too. Yield farming might sound simpler – earning more crypto with crypto. However, as discussed, considering the volume of yield farming protocols and the volatile crypto space, yield farming is no longer a cakewalk.
DeFi Investment Made Easier
Hopping on different sites, reading several whitepapers, expert opinions, tracking DeFi space daily, all these and more, is required to dive into the DeFi investment market. A nightmare, isn’t it? This is where this smart little start uphas your back as they aggregate all the DeFi related information under one roof; plus, it provides you with all the tools to get granular insights into yield farming.
The platform does extensive research daily, so you don’t have to. Project audits, scam repository, comprehensivemonitoring advanced impermanent loss calculator, TVL monitor, beginner guides, best DeFi resources, you name it, they have it all. Honestly, this platform has all the necessary widgets to make your DeFi investment easier, transparent, and most importantly, it helps you to maximize your yield profits. This, when coupled with its easy-to-navigate interface, makes it the best place to do yield farming.
The best part is that the platform has a one-of-a-kind yield optimizer, a smart contract that automatically allocates your investments into the highest yielding projects. Wait, are you telling me I can deposit my funds in this yield optimizer, and that’s it? Yes, invest, sit back, relax, and see your investment multiply (warning! you can lose your coat and more investing in blockchain startups).
That was it in a nutshell. Now let’s have a closer look at this novel platform.
A Detailed Audit of DeFi Projects
The first step of yield farming is to gauge the reliability of the concerned project. For this, DeFi Yield has compiled comprehensive audit reports of over 30 major projects (and counting).
The audit reports are concise, easy to read, and, most importantly, based on high industry standards. Moreover, the audit reports are dynamic, meaning audits are done from time to time so that you are updated on the project’s performance.
Furthermore, scanning the projects is made simpler by assigning risk levels (high, medium, low) and providing a filter to separate projects based on their native blockchain (Ethereum or Binance).
Be Aware of Scams!
Let’s be honest. The DeFi market is full of scam tokens. As a result, identifying fraud projects is as important as finding good yielding opportunities.
DeFi Yield has a comprehensive repository of all yield farming fraudsters. This list not only gives you the know-how of scam projects but also trains you to identify the red signals that indicate a scam. This ensures that you place your funds only in legitimate yield farming projects.
Watch Your Earnings Before You Invest
Yes, there is no crystal ball to predict the future of your investment. But there exists a window that brings all the relevant information in one place, allowing you to calculate the possible earnings on the DeFi asset.
Enter DeFi Yield’s ‘Earnings and Rewards Review’ dashboard!
Here, you will get a micro view into 80 liquidity pools and 9 vaults. This review window allows you to identify assets with the highest APYs. It displays the asset ratio of liquidity pools and vaults, APY, and 7-day yield and performance. Thanks to tailored filters, you can rank the pools and vaults based on yield, total value locked (TVL), APY, and 7-day yield. Moreover, the review window also displays risk levels and hourly, daily, and weekly ROI of the concerned yield farming widget.
Combine all this information, and you can easily scan which pool or vault suits your DeFi portfolio.
The Most Accurate Impermanent Loss (IL) Calculator
There are some factors to consider while calculating your yields. One such factor is impermanent loss.
A liquidity pool consists of two assets in a particular ratio. One asset is stable while the other is volatile. The extreme fluctuations of the volatile asset will hurt your DeFi yields. This loss of funds due to volatility in the trading pair is called impermanent loss (IL). Upon noticing such losses, you might even question your choice to invest in yield farming.
Nevertheless, accurately calculating the IL beforehand can save you from all the hassle. To save you from losses, DeFi yield has one of the most advanced IL calculators that compute impermanent loss with astonishing accuracy.
To calculate impermanent loss, all you need is to enter the details of both the assets, such as token name, pool weightage, etc., and hit calculate. And in a blink of an eye, the IL calculator will give you a detailed table highlighting the impermanent loss with other details like gains/losses, pool value, start amount of the asset, and much more.
The All-in-One DeFi Toolkit
Apart from APY and IL calculator, DeFi Yield has a bunch of other tools to help you with yield farming, including –
This tool keeps you at the driver’s seat by allowing you to control the transfer of approved tokens (tokens a DApp can spend without any further confirmation). You can choose to modify the approved tokens or completely decline to allow the DApp to use your tokens.
Timelock Contract Viewer
Timelock contracts, as the name implies, allow you to schedule transactions in a particular time frame. However, these transactions are processed with a delay to reduce counterparty risk. Timelock Contract Viewer allows you to track functions of the timelock contract, thereby providing a layer of safety.
Cancel And Speed Up Ethereum Transactions
With the ever-growing DApp marketplace, the Ethereum network is getting congested. This results in delayed transactions; sometimes, your transactions can be stuck for hours.
With, Cancel and Speed Up transaction tool, you can save both time and money on your transactions as it allows you to accelerate or decline stuck transactions.
As mentioned, the Ethereum network has congestion issues. As a result, gas prices are becoming expensive every passing day. So much so that gas fee can easily steal your profits. It is no wonder why the gas fee is amongst the major concerns of DeFi investors.
DeFi Yield’s gas tracker allows you to get insights into your gas and transaction costs. This allows you to better manage your yield farming expenses.
Apart from these widgets, DeFi Yield also features Uniswap charts and smart contract checkers to evaluate pool safety.
Yield Farming Optimizer (YFO)
If you don’t want to get tangled into hours and hours of manual research for finding and managing DeFi investments, then YFO is for you!
YFO is DeFi Yied’s native smart contract protocol that allocates your funds across several pools with high APY and expected profit all by itself. You just need to deposit your funds in the YFO smart contract, and that’s it; the protocol does all the hard work. This tool allows you to maximize your profits without any hassle.
For those of you who don’t know, YFO connects with leading DeFi protocols such as Uniswap, Sushiswap, Synthetix, Harvest, etc. Do you still doubt profits?
In addition to these tools, DeFi Yield features a comprehensive library of articles and videos from the best DeFi brains in the crypto space. These resources cover the entire spectrum of DeFi investment – from beginner guides to tips and tricks by yield farming experts; it has everything. You will find these in the ‘Guides’ and ‘Information’ under the Guides and Tools section.
The Bottom Line
Yield farming is exploding like never before. However, to scoop profits from this competitive and crowded space, you need to get your research and tools right. And doing this manually will only make the job harder.
Thanks to DeFi Yield, you get all the yield farming relevant information and tools in one place. Here, you can even choose to do nothing and even bank profits. How, you ask? Well, you should read the Yield Farming Optimization (YFO) section again.
Fellow yield farmers, it’s now time to sleeve up and squeeze as many profits as you can. Happy yield farming!