How to yield farm & why
Are you new to DeFi? Haven’t ever heard of Yield Farms before? Don’t worry, we got you covered. As an NFT + DeFi platform, Liquid Collectibles considers it very important that its users are clear about what yield farms are, how they work, and what their pros/cons are, let’s start with the basics.
Yield farms, what are they?
As a short description, yield farming is a cryptocurrency investment strategy also known as yield or liquidity harvesting, where investors can use “idle cryptos” (that would have otherwise been wasted away in exchanges or wallets) to provide liquidity through DeFi protocols like ApeSwap in exchange for returns.
Yield farming is one of the hottest trends in DeFi (decentralized finances) and it’s one of the benefits the Liquid Collectibles platform offers to its users.
Keep reading to learn how it works and how to yield farm.
How do they work?
At Liquid Collectibles yield farms are used as an incentive for investors to provide liquidity to the protocol and the different NFT collections.
As you might know, liquidity is needed for any asset to be traded, and the more liquidity an asset has, the less volatile and more stable it is.
As a project aiming to provide a safe and healthy environment for users to instantly trade NFT collectibles, it makes sense for Liquid Collectibles to reward liquidity providers.
Pros and cons
- Making your money work for you
- Higher profits than almost any other investment option
- Exposed to price volatility of the underlying assets
How to yield farm on Liquid Collectibles
Before getting into details you need to know that at Liquid Collectibles you have different yield farming options, make sure to visit liquidcollectibles.io/yield to check which those options are.
If you need help choosing a yield farm, you can choose the one with the highest APR (Annual Percentage Rate), the one with the best NFT art, or the one you like the most based on the project idea and the team behind it. If you can’t decide, do some research, or feel free to ask for recommendations in our telegram group. Liquid Collectibles’ original yield farms are LICO-BNB, LICO-BUSD, and LIMOi-BNB.
Important: Some yield farms have deposit fees so please keep that in mind when yield farming.
Ok, let’s get started…
1- Adding liquidity
In order to yield farm you need to provide liquidity first, to do so, visit app.apeswap.finance/pool (ApeSwap is a trusted automated market maker and that’s where Liquid Collectibles’ liquidity is stored), once there, you should see a screen similar to this one:
Now the next step will depend on whether you have or not the two tokens you need to add the liquidity. If you’re trying to use for example the LICO-BNB yield farm then you’ll need both LICO tokens and BNB tokens.
If you don’t, you can buy tokens on that same page, just make sure your wallet is connected, select the tokens to swap, and confirm.
Important: If this is the first time you’re using ApeSwap you’ll be asked to approve the use of your tokens, please make sure the URL on your browser is “app.apeswap.finance” and then you can safely proceed.
Please be aware you need the same dollar value in both LICO and BNB when adding liquidity (e.g: $200 in BNB, and $200 in LICO).
Ok, now you have both tokens, on that same box click on the “Liquidity” tab and then a screen like the one below will show up.
Just add the same dollar value in both LICO and BNB (or whatever tokens you’re using to add liquidity) and then click the “Confirm Adding Liquidity” button. After confirmation and once the transaction has been successfully processed you can go to the next step.
2- Deposit the tokens on the yield farm
We’re almost there, only a few more steps before you deposit your liquidity tokens and start getting rewarded for providing liquidity 😱 how exciting is that? Can’t wait? We neither!
- Visit liquidcollectibles.io/yield
- Connect your wallet
- Click “Approve Contract” on the corresponding Yield farm
- Click “Stake LP”
- Select how many tokens you want to deposit (usually all) and then click the “Confirm” button.
Once you follow all the previous steps successfully and after waiting some time for the rewards to show up you should see something similar to this:
There you can click…
Harvest, to withdraw your earned tokens.
The button with a minus sign to remove your liquidity.
The button with a plus sign to deposit more liquidity.
That’s all, you’re now ready to get passive income through yield farming, we hope this has been educational and helpful, happy farming 👨🌾❤️
Make sure to check our sweet home too: https://liquidcollectibles.io