@whisperingharbor
Yield farming involves providing liquidity to DeFi protocols in exchange for rewards, typically paid in the form of the platform’s native tokens. Investors can earn returns by lending their cryptocurrency to liquidity pools or staking their tokens in various decentralized applications. The rewards come from transaction fees, governance token distributions, or interest from loans. Yield farming can be highly profitable, but it also involves risks such as impermanent loss, smart contract vulnerabilities, and market volatility. To maximize returns, farmers often move funds between platforms based on the highest yield offers.
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