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  • Writer's pictureAspen Digital

Research Series: DeFi Yield Farming Explained

Given the recent issues with yield platforms in the crypto market, we wanted provide more in-depth education surrounding yield farming in decentralised finance. The “contagion” from Terra’s collapse, along with various insolvencies from Celsius to Voyager Digital, has underlined the importance of understanding sustainable sources of yield in crypto. In addition, it is crucial to understand yield farming as a whole — the process of searching for the highest yields on tokens across DeFi protocols through borrowing and lending, liquidity provision and staking. By understanding the process by which each of these yield generation methods occurs, one can properly evaluate and participate in them.

In this Research Series report, we will explain how yield mechanisms work in the crypto industry by using simple diagrams and examples. The ultimate goal of this report is to enable investors to distinguish between sustainable and unsustainable sources of yield.

Read the full report here:

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