What is Yield Farming and How to Farm $KING?

Yield farming is a new concept in the world of cryptocurrency. Having become popular in the summer of 2020 due to Compound introducing participating rewards for its users, yield farming is now being utilized by a number of successful projects in this space since then.
In today’s article, we look into what Yield Farming is and what are its benefits. And finally on how you can farm $KING tokens to earn a passive income.

What is Yield Farming?

Yield farming refers to the practice of generating cryptocurrency rewards via locking your idle crypto tokens. Sometimes referred to as “liquidity mining”, this concept comprises locking up cryptocurrencies for a certain period of time in a cryptocurrency pool and gaining rewards on your locked cryptocurrencies. Think of yield farming as a fixed deposit bank account.
Some crypto enthusiasts draw a parallel between yield farming and staking, but with Yield Farming, liquidity providers (LP) are involved in the process, that is, “farmers” earn interest by providing funds to liquidity pools.

How Does Yield Farming Work?

Yield farming is a process that has a lot of layers to it — the exact specifics vary based on the terms and features of decentralised finance applications. Yet, the basics include locking funds in a DeFi application to earn a reward in return.
Yield farmers usually lock their idle cryptocurrencies, mainly stablecoins such as BUSD or Tether (USDT) in a liquidity pool to inject funds into the pool.
This fuels a particular marketplace where users are interacting with each other by borrowing, lending, or exchanging tokens. Such marketplaces usually have certain fees associated with their usage, which are then paid to the liquidity providers in accordance with their share of the liquidity pool.
This way the more a decentralised marketplace is being used, the more returns a yield farmer makes.

How Are The Yield Farming Returns Calculated?

Normally, platforms calculate the yield farming returns on an annual basis. Two commonly used metrics are the Annual Percentage Rate (APR) and the Annual Percentage Yield (APY). The latter takes into consideration the effect of compounding, while the former does not.

It is worth noting that both the APR and APY are just estimates, meaning that it is very difficult to exactly calculate the returns. This is due to the fact that yield farming is a highly competitive and volatile market. In other words, yield farming rewards can fluctuate quite rapidly.

What Are The Risks of Yield Farming?

While yield farming is quite beneficial, allowing farmers to gain profits, it also has some risks, namely impermanent loss.
Impermanent loss is the difference between holding tokens in your wallet vs holding it in a LP. If you provide liquidity to an LP and the value of token deviates from the external markets, the short-term loss which the liquidity pool suffers is known as impermanent loss.

Also, many-a-time, yield-farming claiming of rewards require the call for several transactions which then results in huge fees. That negates the return on yield-farming.

How to Farm $KING?
SLOWPOKE has Yield Farming in place where users can earn interest on their idle $KING tokens by providing liquidity to $KING PancakeSwap Liquidity pool.

To farm $KING token:
1. Deposit liquidity into our PancakeSwap pair to get KING/BNB tokens
2. These KING/BNB tokens can then be staked into our Liquidity Mining Program Smart Contract here.
3. Start earning interest on your locked KING tokens.

You can read more about our liquidity pool here.

For more information, please take a look at our:

· Official Website
· Telegram Discussion Group
· Twitter

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Slowpoke Finance

SlowPoke is a passive farming deflationary token. Every transaction has a fee of 3.6%, where 1.8% is distributed among holders & 1.8% is burnt reducing supply.