Yield Farming is one of the strategies that comes as a solution introduced in DeFi networks to make new ways of trading and income from crypto assets viable.
Estrategy
Yield farming lets users that are providing liquidity earn B-DAO rewards by locking their LP tokens into a smart contract. The incentive is to balance out the risk of impermanent loss that comes along with locking in your liquidity.
How it Works?
First, the LP investor needs to choose a pool he wants to participate in. Then he needs to deposit his tokens into the pool at a ratio of 50:50. In practice, this means that the amounts deposited in pairs of crypto assets need to match. If you are going to make a deposit of B-DAO and ETH for example, it needs to be R$100 in Box-DAO and R$100 in ETH.
