Yield farming

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orchidmuskrat79
·2020.06.28 17:03

What is "Yield Farming"? How is this working?

Answers

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The hottest buzzword in ccrypto today is “yield farming,” which allows people to earn fixed or variable interest by investing crypto in a DeFi market. Investing in ETH is not yield farming; lending out ETH on Aave for a return beyond the ETH price appreciation is yield farming.

As the newest trend in crypto, investors in the space need to understand what it is and how it works.

But before hashing out the specifics, it’s important to note that given the amount of competition between investors and high gas prices, yield farming is only profitable if you’re willing to put a significant sum of money to work. Yield farming with $100-1,000 in crypto will result in a net loss.