How To Start Cryptocurrency Farming?Admin
In 2022, the correction affected all areas of the digital market. Despite the decline in performance, the DeFi sector is not losing popularity. One of the drivers of decentralized finance is profitable farming. Investments in liquidity pools and lending platforms bring high returns – up to 4000% per year. Risk is limited by coin novelty and volatility. In 2018-2020 such platforms worked on the Ethereum blockchain, so they were only available to investors with large capital. In 2022, cryptocurrency farming will be a tool for the masses. Many DeFi services operate on networks with low fees. Investors can place $10 in liquidity pools, staking, or lending platforms.
What is cryptocurrency farming?
For the first time, the Compound decentralized exchange implemented this way of earning in 2020. For a fee, clients were offered to invest in liquidity pools and issue loans on landing platforms. Profits were accrued in native COMP tokens.
The first DeFi worked on the Ethereum network. In 2021, cheaper blockchains will appear (Cosmos, Polygon). In 2022, 62% of decentralized finance services will be deployed in the Ethereum ecosystem.
An algorithm based on supply and demand sets liquidity providers’ interest. The amount of the reward may change depending on the market situation.