How to Yield Farm with Stablecoins: ‘Parking Lot’ for Dollars that Pays You
Answering the question How to yield farm with stablecoins?, we’ll talk about ways to use them most efficiently and earn at little or no risk.
Because pools with stablecoins experience very low volatility, they have no impermanent loss, meaning they’re almost risk-free.
That’s why such pools are super-popular in times of bad, bearish, or just unpredictable market. Earnings from ‘parking dollars’ consist of:
- Pool fees: 0.2% on each trade. Depends on trading volumes and how much liquidity you provide
- Farming: starts at 0.1% daily (or 36.5% a year). This one is constant and limited by duration only
Yield farming, or farming in short, means that on top of a share of fee charged for every trade (0.2%), you start getting an additional reward for the very fact of locking your assets into the pool. Farming is one of the major money-making strategies in DeFi.
Its goal is to encourage providers to keep liquidity in the pool by offering them extra incentives (usually on a day-to-day basis).
How It Works
Minter has several ongoing farming programs, including those for stablecoins. Take this one:
- The USDTE-USDCE pool
- Daily returns = 0.1% of liquidity supplied (or 36.5% in APR)
- Payouts in BIP coin
- Finishes on: September 1, 2021
If the provider adds, say, $1,000 worth of liquidity into the pool, they will be getting $1 (accrued in BIP) every day until Sep 1. Rewards are sent out via special transactions called MultiSend that you can check out on the page of a given address (each program has its own distribution wallet). In our case, it’s Mx928e86d58123adc2214a4718ce9dd18bf4fe8c79.
How to Yield Farm with Stablecoins?
So, how to yield farm with stablecoins? Anyone can do that by following these 4 simple steps:
- Choose a farming program from the list
- Top up your wallet for the necessary amount of stablecoins. You can buy them with any liquid coin/token in Minter Console or BIP Wallet. If you have no coins on the Minter network, you can deposit them from Ethereum using a bridge in Minter Console
- Use Minter Console to add liquidity into the pool that participates in the farming program you’ve picked
- You’re all set! Starting now, you’ll be getting rewards to your wallet according to the terms of a selected farming program
- How liquidity pools work
- How to add liquidity into pools
- Guide to cross-chain transfers (refer to the USDT Deposit section, the algorithm is the same for all supported ERC-20 tokens)
- Official explorer
- Chainik explorer
- News channel
- Ask a question
This material serves educational purposes only. The information contained herewithin does not constitute an investment, financial, legal, or tax advice, and it is not an offer or solicitation to purchase or sell any financial instrument.