Defi Yield Farming/Liquidity Mining - Last updated Aug 27/2020.

Defi Yield Farming/Liquidity Mining - Last updated Aug 27/2020.

By fblauer | Yield Hacking with Defi | 24 Jun 2020


This a hot new trend involving Defi composability (interoperatbility), and issuance of governance tokens. The assumption is that they will accrue value in the future, since the project governors will vote to allow cash flow earnings to accrue to the governance token holders. It is better than simple staking since it rewards participation in the project, and network adoption instead of only ownership. So it is a good way to raise funds for further development, after a project is up and running. It is also more compliant with legal regulations than an ICO. So, it benefits the projects and the community. This emergent framework for rewarding participation, instead of ownership is called SAFG. 

People have been taking advantage of this trend by re-using their digital assets on multiple platforms and doubling up on the yield. A simple example would be lending a token on Compound, getting a ctoken in return, then depositing that token on Curve liquidity pool (or Uniswap pool) to get transaction fees on the same tokens that they are earning interest. In addition, you are also getting a small share of the distribution of the new COMP governance tokens (which have been going way up in value). Another approach is to take a loan to get part of the COMP distribution, and invest the loan proceeds on another platform. But that comes with risk of collateral liquidation if the pledged assets go down in value. So, this method has to be monitored more closely. See previous articles in my Defi Blog, if you want to know how to use any of the tools discussed below. 

Yield Farming (Liquidity Mining) ROI/APR

  • - This is the best one for ROI on yieldfarming investments. Don't be put off by the spartan text based UI. It is the most important tool, if you are using doing Defi/yield farming. All of the key pools are hyperlinked. If you click on any of the 9 pools listed, it will show you the full APR calculation, your pool amount and share, and rewards.Credit to Weeb McGee for developing (you can follow him on twitter)


Current farming opportunities

  • Comp Tokens (Compound finance)
    • Borrow USDT using eth as collateral (and get part of the COMP distribution) Pay interest at current rate
    • Deposit the USDT back to Compound to get interest at lower rate but get part of the COMP distribution also
    • Or use Instadapp to use leverage to maximize yield (higher risk)
    • Or you could just swap eth for COMP on Uniswap or 1inch, and then deposit them into a Liquidity pool on Uniswap (ex Eth/COMP pool) and earn transaction fees, and get the increase in value of COMP tokens
  • BAL Tokens (Balancer Labs)
    • You can now do liquidity mining on the BAL tokens themselves - (Balancer Passes Governance Proposal for BAL Liquidity Staking). There is a great tool to find the balancer pools with the best rewards called


    • You can combine both Compound and balancer rewards - deposit coins on compound to get ctokens, then deposit the ctoken on a Balancer pool (see to find the best ones). But be aware of the high ethereum network fees when using multiple/complex smart contracts
    • Also, as user "Rookie" points out below, in the comments, in the case of ctokens on balancer, be sure to chose a Balancer pool which also supports COMP, or those COMP bonuses will just accrue to the pool, and not you personally
    • Another way to stack rewards is to provide liquidity on the balancer platform to get some of the BAL token distribution, on the same tokens that you are earning transaction fees from other exchanges (like Uniswap Uni-V2 tokens or Curve crv tokens, or Yearn vault tokens)
  • mStable - this is a metastablecoin with high yields for depositing and staking, similar to They are just in the process of releasing their governance token called MTA. Here is a good article from their blog, which talks about how to provide liquidity on their Weth / Musd or Usdc / Musd or MTA / Musd pools on Balancer to get a share of MTA, transaction fees from swaps, and also BAL tokens at the same time. 
  • SNX (synthetix) integration with Balancer and and Ren
    • Convert eth to sBTC, RenBTC or WBTC on
    • Deposit on Earn transaction fees and also accrual in value (if BTC goes up)
    • Stake on Synthetix/Mintr. Get additional rewards from Synthetix


    • Synthetix also has a similar process for Susd on Curve, and also the Weth / Seth pools on Balancer. Here is a good article from the Zerion blog which explains in more detail how to use these
    • Synthetix and Idle - Mint sUSD and deposit on Idle to earn interest. Soon you will also be able to earn BAL, and CRV by posting sUSD on Idle finance
    • For example you could use to contribute to the SNX/USDC liquidity pool on Balancer to collect liquidity fees and BAL tokens. You can also stake for the SNX rewards from the same interface. Here is an explainer video.


  • YFI tokens (Yearn and Curve) (highest yield currently)
    • Deposit one of the 4 supported stablecoins (below) on liquidity pool and earn transaction fees on the  ytokens and you can also earn YFI governance tokens by staking them directly on same the interface
    • Here is some information about the YFI governance tokens for
    • Here is a recent article from Boxmining which describes the whole process in detail, and also talks about the 2 other balancer pools, which I don't want to discuss here at the risk of making this article too complicated. If you are advanced and interested in the details, you can just read all about it in the article above, or guide below


Here is a another good guide on how to earn YFI governance tokens. Currently, the price is going crazy




(Here is the original announcement)

  • UMA - Liquidity mining process has just been released. You can check current reward yields in the tool. Currently, it is about 50%, (not including the BAL rewards). They are planning to issue rewards over 6 weeks from now. 
  • BZX (Fulcrum) - Share of fees for staking BZRX governance tokens on balancer + share of balancer fees. Here is an article on how it works. If you buy the tokens on Uniswap, you will also be entitled your share of the rewards, as detailed in the guidance. 
  • Ptokens - Stake in the pNetwork DAO. Earn 42% rewards for voting (Similar to KNC staking)
  • aTokens (Aave and 1inch and curve)
    • Deposit any of the tokens supported by Aave, get atoken and earn interest
    • Find one of the atoken pools on Balancer and deposit there to earn some BAL. Use this tool to find the best ones
    • Or Convert the atokens on to any of the tokens supported by any of the pools on, or Uniswap V2 and earn transaction fees
  • Uniswap/Aave - You can also use the Uniswap pool tokens as collateral for loans on Aave
    • Deposit tokens and eth pairs on Uniswap pools and get the Pool tokens (get the ones with the best rates on (scroll down and sort by Net ROI)
    • You can get the pool contract address on the pool info page (if you need it)
    • Use the Unipool tokens as collateral to get USDT (for example)
    • Deposit the borrowed USDT on Compound to get COMP tokens
    • Monitor the loan on Aave to make sure the value doesn't fall below the liquidation ratio
  • Curve Tokens (CRV)
    • CurveDAO - Governance token, Aragon-based DAO, @AragonProject, Staking(vote-locking), DAO collects trading fees and executes $CRV token buy-back burning
    • Past users of curve get vested CRV tokens over a year, which you can claim periodically. 


New users also earn CRV tokens after staking their redeem tokens from any of the 7 Curve liquidity pools (stablecoins and xbtc pools). You deposit and stake them in the guages, earn CRV, and then claim them in the mintr tab:


Future (In-progress or Not yet available)

Gas fees on swaps and deposits/withdrawals

The best way to reduce network fees is to use a yield aggregator to share the costs and other resources, as per above. 

If you are using Synthetix , you can also use this very cool site which allows you to use the Chi token to save on gas fees when claiming SNX rewards from staking. There will also be pooled SNX staking vaults from, as soon as they are approved by the community governance shortly. This will allow you to take advantage of Synthetix smart contracts which are complex, without incurring so much in the way of gas fees, especially if you don't have a huge investment. 

Another good way to reduce gas costs is to enable the chi token when doing swaps in Here is an article which explains in detail. Another thing that you can do is to check and try to do your transactions when gas fees are lower. Yet another alternative is to use Loopring L2 solution for trading/swaps. It isn't quite as convenient as an AMM like Uniswap or balancer, since you have to deal with transferring your funds to/from the exchange, and mess with order books, which aren't as simple as the other Dex's. Another thing that you can do to reduce gas costs is take longer term positions. If you keep buying and selling over short time periods you will incur so much in fees, that you may end up with losses instead of gains, even if you made the right decisions (unless you are trading huge amounts). 

There aren't any ideal solutions yet, but they will be coming soon as the scaling solutions start to proliferate. First L2/State channels and sidechains, then interoperable chains like Polkadot or Fusion or Cosmos, then Eth2, in the longer term. 


There are lots of different ways to participate with varying rates of risk. This trend is very hot right now, but will inevitably cool off. And be aware of the inherent risks of interdependence. The more platforms that your connected investments depend on, the more chance that something could go wrong in any one of them. And the more you are leveraged, the more chance that the value of your collateral could go down, and trigger liquidation. So make sure to monitor your investments, especially if your are leveraged. Another caveat are the network fees, which can really add up when a lot of complex smart contracts are involved. Here is a good article from Kerman Kohli, which explains the gas fees in more detail, and another great article that I just discovered by Tokenbrice, from Monolith

I will update this article as new opportunities become available. Happy farming, and stay safe. 


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Yield Hacking with Defi
Yield Hacking with Defi

This is a blog about the intersection between crypto currency and finance. I have been testing and evaluating various defi (decentralised finance) and opfi (open finance) projects. This includes lending and borrowing markets, decentralised exchanges, automated market making, smart contract wallets, and tools for measuring and monitoring return on investment. All enabled by blockchain technology, with decentralised, opensource and audited smart contracts. These systems are interoperable and composable.

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