The dummies guide to farming sushi on sushiswap

Sushi Swap — Adding liquidity to sushiswap

By cryptocloaker | cryptocloaker | 31 Aug 2020


A complete dummies guide to farming SUSHI on sushiswap.org

I’m going to assume you know what Uniswap, Sushiswap & Ethereum are all about. If you don’t please use your favourite search engine to research and come back later. To be honest if you’re still in the dark then you probably were searching for the real edible sushi — in which case some search algorithm let you down. Bad AI. Bad thing.

Exciting point — if something is bold, it’s a link to something useful.

NB: If you are the owner of any images used in this blog post, please contact me to have a good old whine and I’ll see about removing the offending image.

 

Another exciting point — this article is probably time sensitive as sushi swap is still in its infancy, so as of 31st August 2020 this was spot on…

11th Sept 2020 — IMPORTANT: sushiswap has now migrated and no longer uses/needs Uniswap LP tokens. Any reference in this guide to Uniswap UNI-V2 LP tokens are now defunct — you need to use Sushiswap SLP tokens instead. I’ll update shortly.

 

For this walk through we’ll use MetaMask — sushi swap also supports WalletConnect. I’ve not used WalletConnect, it’s probably the same process but you’re on your own with that.

Go and buy Ethereum from your favourite FIAT on ramp provider — such as coinbase etc. Coinbase link here For this example, we’ll assume you have just bought 10 ETH (ETH is the word symbol for Ethereum). Please note, you don’t have to buy 10 ETH, you can do all the below with less, just make sure you do enough to warrant the ETH GAS fees that are going to hit you.

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Install MetaMask into your browser. Metamask link here

After you have done all the setup, written down your secret phrase and memorised your password etc, you’ll have automagically created a MetaMask wallet address — this is an Ethereum address which you can give to anyone and they can use it to pay you Ethereum or any ERC20 token.

Welcome to 2020 — where have you been?

Anyway, click on your address at the top of the MetaMask widget popup and it’ll get copied to your clipboard.

Now flip back to coinbase/whatever you used and send the 10 ETH to your MetaMask wallet address. How to do that link here

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Next we need to add SUSHI as a token to MetaMask so you can see your balance later, do this by opening MetaMask and clicking Assets, scroll to the bottom and then click “Add Token”, then click “Custom Token” and paste in the SUSHI Token Contract Address, which is….

0x6b3595068778dd592e39a122f4f5a5cf09c90fe2

…after you have pasted that in, click Next and it’ll be added to your MetaMask wallet. Ethereum has lots and lots of tokens, MetaMask doesn’t have them all pre-loaded — that would be nuts.

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As always, you should always do your own checking! — So visit the Sushi coingecko listing to double check that contract address.

One final thing to note before we begin our swapping journey is that of GAS fees and limits. If you get any GAS errors, try increasing your GAS limit in MetaMask — read here for more help. (Don’t worry, this will make sense later!)

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Now we’re going to Uniswap to buy 4.5 ETH’s worth of SUSHI. Click here to visit the Uniswap Sushi buy page here

NOTE: You’ll get a scary warning popup telling you that here be dragons etc, click “I understand” — if you get scared at this point then this stuff really isn’t for you and you should go back to your high street bank savings account.

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Top right, click “Connect to Wallet”, MetaMask will now pop up asking you if you trust the site and want to continue etc, say yes to it all. It’s like an EULA — if you don’t accept you can’t proceed, oh what choice we have.

This slippage bit is optional. Some folk will have kittens, some just want to crack on and buy Sushi and accept a bit of price change…

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After the wallet connects (it’ll now remember this link), click the cog icon top right of the Uniswap page — we need to adjust your tolerance to price slippage — this SUSHI world is rather fast paced at the moment so lets make it so we accept a bigger price change when we commit later on — click the cog and change the Slippage Tolerance to 5% — you’ll need to type the number 5 in the box. Once you have typed 5 just click anywhere outside of the cog popup bit to save the change. Oh how I miss the days of clicking Save to make changes, “stuff” just auto happens now.

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Now put 4.5 in the ETH (From) box and the SUSHI (To) box will automagically update. The SWAP button will now enable, click that and Metamask will popup again asking you to agree to the transaction. This is where you need to look at the network fee — depending on how busy the Ethereum network is, this can get quite crazy. Anyway, you’re here to blindly follow some random internet stranger, right? So click accept on MetaMask!

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After what feels like years (it’s actually up to a minute or so) you’ll see your ETH balance drop in MetaMask. You will also see your SUSHI balance change to the amount you just bought (or more or less depending on how quick you were!)

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At this point you could just stop and pretend to be a world class day trader or a cellar dwelling HODLer, but that is not you. You are a wannabe DEFI farmer. So let’s continue the madness…

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We’re not quite ready to jump to the main sushiswap page yet, the last thing we need to do is get a Uniswap Liquidity Pool token, which we can then give to sushi swap to start the farm.

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On the same Uniswap page where you bought SUSHI, click the Pool tab (it’s next to the word Swap). Click the “Add Liquidity” button. If you don’t see it saying ETH and SUSHI either use this link or select the tokens by hand as follows: Select ETH and click “Select Token”, next you’ll see a popup saying Choose a list — at this point pick any list you want — the Uniswap default list is a good safe bet for the future, it doesn’t matter for this stuff — then just paste the SUSHI contract address in the search box (See above, or copy this: 0x6B3595068778DD592e39A122f4f5a5cF09C90fE2 ), then select SUSHI.

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Type the number of SUSHI you have in your wallet in the SUSHI box, the ETH value will adjust accordingly. This is why we only bought 4.5 ETH of Sushi - the key to liquidity pools is that you create them with equal monetary values on both sides. If you just bought 100% Sushi with all of your ETH, you are going to have to go and get some more ETH to match the monetary value of the Sushi you bought! Somebody doesn't follow instructions, do they? :-)

Now click “Approve SUSHI”. MetaMask will popup again asking you to confirm, click “Approve” and go make a cup of Coffee.

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Once your transaction gets confirmed on the network, you’ll be the proud owner of some SUSHI-ETH UNI-V2 LP tokens!

The chef is waiting…

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Now, FINALLY we can head on over to sushiswap.org and get that stuff added! Go to sushiswap.org now.

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Open the Menu link at the top of the page and select the Sushi Party! box.

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You’ll now see two boxes, a Sushi balance and a Staked balance (under the picture of a chef), since this is your first time you should see a button labelled “Approve SUSHI-ETH UNI-V2 LP”, click that and MetaMask will popup again asking if you want to give the Sushi system control over your tokens, do your own research here, but since you’re here to learn how, not why, click “approve”.

The button on the sushi page will now change and a new + button will appear — click that and then click the MAX button in the next popup. Then click confirm, MetaMask pops up again, click confirm and now RELAX.

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You are done. You have bought some land, ploughed the soil, bought some seeds, planted those seeds, now it’s time to wait and then become a fully fledged DEFI farmer and farm your Sushi! OK, that scene I’ve set doesn’t quite make sense, you don’t plant Sushi, but you get my drift.

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After some time, you’ll see your SUSHI Earned value slowly creep up — this is akin to looking out of the window and seeing your crops growing. If you run out at the first sight of crop you’d be wasting your time. Why? Well it costs time & energy to perform a harvest, so it’s best to wait until there is enough to harvest to cover the ETH GAS fees you’re going to have to pay in order to get that Sushi into your MetaMask wallet. So, WAIT. be PATIENT. Look at the coingecko Sushi price, bide your time.

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Once your potential SUSHI harvest value is worth it, click the Harvest button. MetaMask will popup again, fall off your chair at the GAS fees, then click “Approve”. Warning: If you are slow, or you thought you got away with a remarkably low GAS price, your Approval transaction can fail, typically with the error “Out of gas” which means your GAS limit was too low.(You can edit the transaction approval in the MetaMask popup and click the advanced tab and the increase the GAS limit if you are prepared to pay more). This is not only annoying but costs you GAS fees. Spend a bit of time swearing at your machine, then click “Harvest” again and be faster clicking “Approve” on MetaMask (and increase the limit, your call but not always required, especially on quiet days). Wait a while and your SUSHI Earned value will drop to zero and your MetaMask SUSHI balance will increase!

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Now you have SUSHI in your MetaMask wallet you have two paths ahead of you…. A] Sell your SUSHI for ETH or B] HODL your SUSHI. Lets choose option A, as this isn’t a guide to trading.

Simply go back to Uniswap and swap you SUSHI back to ETH, you can use this link if you wish: Link here.

It’s exactly the same as before, put values in, click swap, approve in MetaMask. Very simple.

All that is left is to send your ETH back to coinbase or whatever you used and turn it back into that paper money stuff that currently lets you buy bread, pay the rent etc. You could of course leave the ETH in your MetaMask wallet and HODL that instead, especially since it’s got a larger market cap so probably more stable in value.

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If you want to get out of staking, you can simply un-stake and then go back to Uniswap Pool and remove liquidity link here.

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It’s not only the Sushi Party box on the menu. You can do the same process with all of the other tokens shown on the Sushi Swap menu page. Just go and buy those tokens — YFI/BAND/LINK etc, it’s all about creating that LP token on Uniswap. Each menu offering still yields you Sushi. The savvy amongst us will create liquidity with stable tokens — beware the impermanent loss!

Regarding impermanent loss - I found this response on the sushi discord channel which summed it up nicely with regards to sushi....

Your pool always needs to remain 50% sushi 50% ETH in terms of USD value, so whenever sushi price goes up, the pool automatically re-balances itself by removing some sushi and compensating with more ETH... and vice versa. so in a move up, your gains are 50% lower than they would be if you had your sushi outside of the pool... but in a move down, your losses are 50% lower as well - that is a simple case where only one assets move in one direction and again, that is excluding the fees you make from the pool... so its actually a bit less than 50%... and, if you stake this pool to farm sushi, you also need to take into account the extra earned sushi... which reduces this gap further!

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None of this is financial advice. Do not assume I know what I am doing. Do your own research, speak to a qualified advisor if you want to. I wish you every success in the future and hopefully this article helped shed some light on this currently crazy time we are experiencing in crypto!

Happy farming!

cryptocloaker

PS: If you like lucky dip style rewards — get in the top 100 wallet holders of PORKCHOP. What has happened to the world?!

PPS: check out zapper.fi - it aggregates everything you hold in your MetaMask wallet and shows your whole portfolio value.

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cryptocloaker
cryptocloaker

in crypto since 2012, on earth much much longer


cryptocloaker
cryptocloaker

My random musings and potentially helpful articles on all things crypto

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