Let's say...ABCD & ABC is your Token !
In this article we see how to start “farming” your ABCD tokens.
- What is Yield Farming?
To put it simply, farming means being rewarded by new crypto assets for lending or staking your crypto assets.
When you put your money in the bank, you get interest. In the cryptocurrency world, when you stake your assets, you may receive interest or fees as reward. This depends from project to project.
When a protocol gives you high amounts of newly generated cryptocurrencies in return for your staking, this is known as yield farming.
These tokens can rapidly appreciate in value and make the early investors rich.
So imagine someone asking you to deposit Rupees and Dollars with them, in return they will give you thousands of little coins every few minutes as a reward. Maybe these little coins have no value in the beginning, but if someone starts accepting it, thereby creating a use case for them, these little coins can make you very wealthy and your original rupee and dollar is safe in a smart contract that you can extract anytime you want.
- What is ABC and ABCD Token ?
The new DeFi protocol is focused on yield farming and also towards improving the ecosystem for Your Project as an exchange, Your Token ABC – will be the exchange’s native token and ABCD – the DeFi protocol token.
Users can essentially stake some of their cryptocurrencies like ETH, USDT, USDC, ABC, ABCD, YFI, SUSHI and earn ABCD token as reward based on the interest rate and amount staked. This is the simplest form of explanation. As we learn how to do it, we will understand several steps in the process, platforms like uniswap and how to get the most out of your reward tokens.
The most important thing to remember is that every transaction is done on Ethereum network and using a smart contract. The smart contract is built in such a way that with every Ethereum block, it creates new ABCD tokens and then distributes them to the addresses that have staked their tokens on Your ABC Platform.
We will discuss this further in the Next article.
