***Disclaimer. This is not financial advice and please know your own risk before attempting anything related to investing, crypto or fiat.***
Back for my second post here.
This post is going to be a mix of a guide/ review of how my yield farming has gone to date.
I only started about a week or two ago and I would like to share my experience thus far.
Here is the layout of this post and skip to whichever parts you are most interested in.
1. Basic knowledge and helpful hints to keep in mind.
2. What wallet to choose why?
3. How to fund wallet
4. How to participate in yield farming.
5. My yields and lessons so far.
1. Basic knowledge + helpful tips for getting started
What is yield farming and why did I get into it?
I love dividend investing and I love the idea of money making money.
Yield farming is a like dividend investing on steroids because it is basically giving you an extremely high annual dividend payout and the frequency of this payout is happening multiple times a day.
Now it all sounds great but high reward there is most definitely high risk.
I saw some posts on Reddit and some YouTube videos explaining and the idea of money making money is so great that I just had to try.
Click hyperlink below for much better description/explanation of yield farming by coin market cap.
Some important things to note about getting into yield farming:
- You will need to download a crypto wallet, fund the wallet, navigate dapps, and obtain these new tokens. (Will go over later in post)
- Understand that there is risk involved. Do not risk what you are not willing to lose!!
- Binance smartchain and Ethereum blockchain are two different ecosystems.
- Gas fees occur anytime there is a movement of value or swap of value. For example, transfer from exchange to wallet, swap of main coin into tokens, putting tokens in liquidity pool, staking tokens, and the revers of all those.
- Ethereum gas fees are insanely high right now so unless you are moving $1000+, may not be worth it.
- Binance gas fees much lower
- Make sure you have enough balance in wallet to be able to pay gas fees for unstaking tokens.
^^^ Some of that will make sense and some may not. By the end of post hopefully you understand a bit more.
Metamask is great for ETH blockchain and Trust wallet is great for both ETH blockchain and Binance smartchain .
I personally use trust wallet very and everything I do crypto related is on my phone.
Setting up a trust wallet is very easy for mobile.
The following is a link to a very simple to follow tutorial and guide on how to download and use trust wallet:
Trust Wallet Beginners Guide
Step 1: Download Trust Wallet App
Step 2: Record seed phrase. Do not lose this! Do not share this!
This wallet is useful for yield farming, but I would not keep all my assets in this wallet. If I have something like ETH or BTC in which I do not want to stake and I just want to HODL I recommend getting a cold storage wallet.
3. How To Fund Wallet
Tons of different ways to fund wallets. Its different depending on your geographical location.
I am living in Canada and this is what I found to be the best strategy for funding my trust wallet.
First off I decided that I wanted to participate in yield farming with binance smartchain rather than ethereum blockchain.
This is due to the significantly higher gas fees for ETH.
This means I want to get BNB.
Easiest way I have found in Canada is to buy BNB directly from the binance website.
It is extremely easy and you can purchase with debit or credit card. Transactions take no more than 5 minutes.
You will need to first set up and account with Binance website, secondly get your account verified with government photo ID (took only 2-3hrs), and I suggest using credit card rather than debit.
*All done on mobile*
Step 1: Sign up at Binance
Step 2: Perform account verification process. You can access this by clicking and opening your profile page.
Step 3: Once verified, go to binance main page. Top right corner of mobile site has a icon which is 3 horizontal lines. Open this menu tree and choose the buy crypto option. Then choose your preferred method of payment, I suggest credit card.
Step 4: Enter card information. Verify that you are purchasing in the correct currency and also purchasing the correct crypto currency.
Step 5: Wait for a few minutes before transaction is complete.
Step 6: Once purchase of BNB complete, open up trust wallet and click the BNB token. Then open up your receiving address. It will be a QR code you can scan and a string of letters you can copy directly to address. This is your receiving address.
Step 7: Go to BNB and perform a withdrawal. It will prompt you for a wallet address. This is where you paste your BNB wallet address that we obtained in the previous step. Waiting for BNB to transfer from Binance to wallet will take up to 5 minutes.
4. How to participate in yield farming
At this point we have our Trust wallet funded, but how to we start yield harvesting?
On the main page of your trust wallet, the bottom row will display 4 menu tabs to choose.
Click on DApps and you can see a decent amount of options for different DApps to use for defi and yield farming.
I suggest you do your own research on which DApps are safest and what you feel most comfortable investing in.
I am currently using both Pancake swap and beefy.finance
I started off with using Pancake swap as it was a little more user friendly.
I then transferred most of my savings to farming pools on beefy.finance.
There are a few big differences between the two sites but the deciding factor to me is how your yield is paid out.
With Pancake swap your interest earned is paid out in CAKE token.
Where as with beefy.finance your interest is paid to you in form of whatever token/ token pair you have in liquidity.
Below is my step by step guide for getting started with beefy.finance and how to yield off binance smartchain.
*Not using Eth because gas fees are too expensive*
Step 1: Have trust wallet open and have some BNB available.
Step 2: Convert BNB into with swap to smartchain function in wallet (1:1 trade) This will change BNB into BNB smartchain. BNB smartchain is what is used to be able to swap for tokens.
Step 3: Confirm you have BNB smartchain in wallet ( may take a coupe minutes to transfer)
Step 4: Open DApps screen and choose beefy.finance
Step 5: You can sort through all liquidity pools listed on site. All pools will have APY% (annual percent yield), Total Volume locked up in the pool, and the expected daily return. This is important to note anybody can make a token so be cautious what token/token pairs you invest in.
Step 6: Once you have decided which token pair you would like we are going to go ahead and connect your wallet. For this step you will want to verify that you have the correct smart chain chosen in the top right corner of the app.
Step 7: On pair or single token you have selected to gain yields from, you will now have to obtain the token/taken pairing. This is made extremely easy on beefy.finance. On the token/token pair you have chosen, look for the buy token option. This will link you directly to a tokenswap that deals with this specific token you want. Use your discretion as you purchase. If you are purchasing for a pair of tokens remember to have sufficient volumes of both tokens. **Important to wait on tokenswap transaction page until transaction is complete. This may take a few minutes.
Step 8: Once you have received the tokens, Can verify by checking balance of tokens on the exchange you were just on for obtaining those tokens. The next step is to add these tokens to the liquidity pool. In your Trustwallet, go back to the beefy.finance. Now we will click on the add liquidity button. This will take you to the add liquidity page of the whatever tokenswap you were just previously using. It should automatically set up the tokens for liquidity supply, but make sure that these are correct. It should show balance for both tokens and also shows how much of each token will be required for a pair. Enter the amount you would like to supply for liquidity and then supply it. This will take another few minutes of waiting on transaction screen to insure your tokens are added to liquidity pool.
Step 9: Head back to beefy.finance and click/touch the token/ token pair you just set up for liquidity. You should now be able to see your token balance. From here you will want to hit the 100% deposit all option and wait for the approval message. It should flash a green approval message in the bottom left of screen and then a second one. This will take a couple minutes as well. I have had this fail on me previously. to fix I would just exit the DAPP and re-open it. Transaction worked the following time.
Step 10: You are set! Now just log back into Beefy and watch your deposited balance grow daily!
5. My personal Experience and Returns Thus Far
I have only been using the yield farming for less than 2 weeks.
Overall I have lost value in my investments due to the recent downtrend in all markets.
This I am not too worried about as I look at it similar to regular dividend investing.
I think my major returns will be a result of long-term yielding.
I originally started on pancakeswap in the Cake-BNB and in the PNT-PBTC farms.
I joined the CAKE-BNB because it seemed the safest at the time and then I joined the PNT-PBTC as it was advertised at an extremely high annual percent return. I stayed in for about 5 days and yielded enough cake token (close to 30$) to cover my gas fees on joining these pools and also enough money to get me out of these pools and into other ones.
I decided that since this is my YOLO money lets be a little risky.
I kept my liquidity in the PNT-PBTC yield farm on pancake as it is still 200+% apr.
As for the rest of my BNB ($2500) I wanted to maximize my yield gains.
This is when I discovered beefy.finance and started using it.
I have entered 2 pools:
Palm -BNB LP 11.09k% APY initial deposit: 43.2599 Today balance (after 6-7 days) : 45.5391
KEYFI-BNB LP 6.37% APY initial deposit: 3.66313349 Today after ( 3- 4 days) : 3.76710073
I currently make about $5 in CAKE per week from my small position in the PNT-PBTC farm from pancake swap.