Moving capital between DeFi protocols to maximize returns. Yield farmers chase the highest-APR opportunities, often layering: deposit collateral, borrow against it, deposit the borrowed asset elsewhere, repeat. The strategy can produce substantial returns in bull markets but compounds smart-contract, oracle, and liquidation risk. Many farmers lost more in the 2022 contagion than they earned through 2021.
Yield farming
Moving capital between DeFi protocols to maximize returns. Yield farmers chase the highest-APR opportunities, often layering: deposit collateral, borrow against it, deposit the borrowed asset elsewhere, repeat. The strategy can produce substantial returns in bull markets but compounds smart-contract, oracle, and liquidation risk. Many farmers lost more in the 2022 contagion than they earned through 2021.
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