How to Yield Farm in 2023
Framework for yield farming in 2023
This is a compilation of frameworks and resources for yield farming in 2023. I am also making more detailed videos on the subject.
Sources of Yield
Staking - Using tokens to secure a L1 network or participate in protocol governance in exchange for revenue share and inflation.
Lending - Lend tokens out in exchange for interest.
Liquidity Pools & Liquidity Mining - Deposit 2 or more tokens into an AMM pool to provide liquidity in exchange for transaction fees and incentives.
Options Strategies - Various options strategies, such as covered calls, to earn passive income.
Resources
StakingRewards - Tracking the staking rates, inflation rates, and other staking stats for tokens.
DefiLlama Yield Farms - Detailed searching and filters for thousands of yield farms.
DefiLlama Correlations Matrix - Check the correlation between various tokens.
DeBank - Track your wallet portfolio across EVM chains.
Yield Farming Process
Identify tokens you want to earn yield on
Identify which of those tokens you can stake using StakingRewards
Calculate correlation between tokens using the DefiLlama Correlations Matrix
Identify liquidity pools where APY outweighs risk of impermanent loss using the DefiLlama Yield Farms database
Portfolio Allocation
A successful portfolio for a particular ecosystem, fulfills these criteria:
Provides exposure to the upside of that entire ecosystem (ex: a Solana portfolio, should provide exposure to SOL)
Modest exposure to key ecosystem tokens
Takes advantage of yield and airdrop opportunities within key applications of that ecosystem
Favorite DeFi Projects by Chain
Solana DeFi
Jito - Fast growing SOL liquid staking protocol. MEV-powered staking rewards. Likely future airdrop
MarginFi - SOL lending and liquid staking market. Likely future airdrop.
Marinade - Largest SOL liquid staking protocol. Boosted MNDE rewards for staking SOL and referring friends.
Drift Protocol - Perp DEX on Solana. Wide variety of pairs.
Orca - Largest DEX on Solana by volume. Good yields on liquidity pools at the moment.
Base DeFi
Aerodrome - Largest DEX on Base. ve(3,3) token and incentives model.
friend.tech - Flagship SocialFi dApp on Base. No way to technically earn yield right now, but high probability of an airdrop.
Beefy - Multi-chain DEX aggregator. Useful for finding and managing liquidity positions on Base.
Curve - Blue-chip DEX. Elevated yields on Base.