Yield farming could easily be classified as a full-time job for those that want to chase the best yield on every chain and experiment with different farming strategies. Thankfully, if you know which tools to use you could be able to stay on top of the game while not spending too much time managing your farms, and that is exactly what we will be talking about in this article.
What Is Yield Farming? #
Yield farming emerged very soon after DeFi started grabbing the attention of many crypto investors. It gives decentralized exchanges and protocols a way to reward those that provide liquidity on their platforms.
Usually, they would require investors to pool together two currencies at a 50/50 ratio and the longer they keep it in the liquidity pool the more rewards they will accumulate. In short, users provide liquidity in exchange for passive income. But how do you find the ones with the highest rewards?
Yield Farming Tools #
There is still no all-in-one solution that would give you all the required information in one place but with a combination of a few useful sources it should be a lot easier to find the best opportunities.
Coingecko is a popular price-tracking website for crypto assets but it also tracks a variety of farms. To access this page simply click on “Yield Farming” under the Resources tab.
Farms can be sorted by the yearly return percentage but here you will also find an impermanent loss and APY calculator, both of which can be very useful.
Coinmarketcap also has a dedicated page for yield farming but their list mostly focuses on the Binance Smart Chain projects. Some farms may be out of date so make sure to double check the information before depositing any funds.
With the Zapper DeFi dashboard you can find the highest-paying liquidity pools and enter them directly through the Zapper dapp. Simply visit the invest page, connect your wallet and “zap” your funds into a liquidity pool using only one cryptocurrency of your choice.
Zapper tracks liquidity pools on Ethereum, BSC, Optimism, Polygon, Fantom and Avalanche.
It is worth noting that not all of these liquidity pools will accumulate farming rewards on top of the deposit. The displayed returns are for providing liquidity only, so it should be best to check the protocol itself for any extra rewards that may be available.
In case the solutions mentioned above aren’t useful enough, you can try searching for farms manually with Vfat.tools. It will give you access to almost every farm on 28 different blockchains but finding the best APY and APR among them will have to be done manually.
Yield farming can be very rewarding, especially if you can be in the right place at the right time. Hopefully these tools will make that process a little bit easier. As always, getting familiar with the possible risks such as impermanent loss is highly advised before starting your farming journey.
High APR numbers won’t always guarantee profits if you are not familiar with both the upsides and the downsides of yield farming.