Farming
The practice of depositing, lending, or staking crypto assets in DeFi protocols or liquidity pools to earn rewards such as interest, trading fees, incentive tokens, or points.
In a sentence
The user began yield farming by depositing tokens into a DeFi liquidity pool.
- The user began yield farming by depositing tokens into a DeFi liquidity pool.
- Farming rewards included trading fees and newly issued incentive tokens.
- The investor compared the advertised farming yield with smart-contract and impermanent-loss risks.
- A change in token incentives made the farming strategy less profitable.
- The protocol distributed points to users farming assets in its lending market.
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