Yield farming has become a very popular type of investment in cryptocurrency because of its potential for high returns. Yield farming, also called liquidity mining, is when you put your tokens in a liquidity pool on decentralized finance (DeFi) platforms and earn rewards in the form of new tokens. This can lead to a big increase in your crypto holdings, making it an attractive option for those looking to grow their investments.
Read more about yield farming
Yield farming is also a great option during bear markets when cryptocurrency prices tend to be low. By investing in liquidity farming, you can earn additional tokens while holding onto your existing assets. This can help you to minimize losses and even generate profits during a bear market. Plus, yield farming can also help protect you against inflation, as you earn rewards that keep up with the rate of inflation. What else can you do during a bear market? Find out here.
CrowdSwap has been busy and is constantly stepping up its game when it comes to yield farming opportunities for users. The project’s been adding even more options for yield farming lately, giving investors more chances to earn rewards on their crypto investments. Plus, CrowdSwap is always tweaking and optimizing its yield farming process to make sure users are getting the best possible returns. This includes giving more flexibility to choose the tokens they want to use for yield farming.
In addition, there will be more exciting news in 2023 that will make it more attractive that we’ll surprise you with! In this article, we’re going to take a look at three different options offered by CrowdSwap: “Invest by Pair,” “Invest by Swap,” and “Invest by Crosschain.” Let’s take a look at these three possibilities that are currently available to CrowdSwap users.
Scenario 1: Invest by Pair
The first option is called “Invest by Pair,” which is incredibly straightforward; and of course, recommended by CrowdSwap! You won’t need to worry about token swaps, so you can avoid issues such as the “price impact too high” error or the high demand during the launch of the liquidity pool. To use this option, you’ll need to have both tokens that exist in the liquidity pool pair and allocate an equal value of both tokens.
For example, suppose you have $200 worth of tokens A and B. If Token A costs $1 and Token B costs $2, you’ll need to put 100 of Token A (worth $100) and 50 of Token B (also worth $100). This means that you can invest in a liquidity pool without having to go through the hassle of swapping tokens or dealing with unexpected complications. Let’s dive into a more practical example.
In the above example, let’s say the user has both MATIC and CROWD tokens in their wallet. The app automatically calculates the amount of both tokens needed (in dollars) based on the current market price, creating a pair. Once you hit the ‘Invest’ button, you’re all set! In this case, 10.4 MATIC is worth around 199 CROWD. Of course, you can choose to invest a different amount as long as you have enough of both tokens in your wallet.
Scenario 2: Invest by Swap
Let’s say you’re interested in investing in a liquidity pool that requires both Token A and Token B, but you only have Token A. This is where “Invest by Swap” comes in handy. When you choose this option, CrowdSwap will automatically swap half of your Token A for an equal value of Token B and create a pair for you in the liquidity pool. This means that you don’t have to worry about buying Token B from an exchange or finding a way to swap it yourself.
The beauty of this option is that it simplifies the investment process, making it easier for those who only have one token to participate in liquidity pools. The system takes care of the swap for you, which can be a huge relief if you’re not familiar with swapping tokens on your own. But that’s not all! If you have a token other than the pair but on the same network, this option also comes in handy. Let’s make it a bit more real-world.
In the above example, the user has MATIC on their wallet, which is on the same network (Polygon) as the chosen liquidity pool on CrowdSwap (USDC/CROWD). Then the system swaps the selected amount of MATIC to an equal amount of USDC and CROWD. Then the system will prompt you to confirm the transaction, and that’s it.
It’s important to note that this option only works if the token of your choice (MATIC) and the token pair (USDC/CROWD) are on the same network (in this case, Polygon). If they are not, then you may need to use the “Invest by Crosschain” option, which is the third scenario.
Scenario 3: Invest by Crosschain
Let’s say you have a token that you’d like to invest in a liquidity pool, but it’s not on the same network as the tokens in the pool. The option of “Invest by Crosschain” proves to be useful in such a scenario. With this option, the CrowdSwap platform will automatically swap your token for an equal value of Token A and Token B, which are the tokens in the liquidity pool pair. Once the swap is complete, the system will create a pair for you in the liquidity pool.
This feature allows you to invest in a liquidity pool even if you don’t have the same tokens as the pool requires. This means that you don’t have to go through the hassle of swapping your token for the required tokens on a centralized exchange or through a complicated process. CrowdSwap has made it as simple as possible, allowing you to invest in the liquidity pool with just a few clicks.
Let’s say you have $200 worth of Token C, which is not on the same network as Token A and Token B, the tokens in the liquidity pool pair. Token C is worth $4 per token, so you have a total of 50 Token C.
To invest in the liquidity pool, you would need to swap your Token C for Token A and Token B. However, this can be a complicated process and may involve multiple steps, such as finding a crosschain DEX platform or using a centralized exchange.
With the “Invest by Crosschain” option on the CrowdSwap platform, you can easily invest in the liquidity pool without having to go through all of these steps. Here’s how it works:
- You select the “Invest by Crosschain” option on the CrowdSwap platform and enter the amount of Token C you want to invest, which is $200 in this example.
- The CrowdSwap system calculates the value of Token A and Token B based on their current market prices. Let’s say Token A is worth $1 and Token B is worth $2.
- The system automatically swaps your $200 worth of Token C for an equal value of Token A and Token B. This means you would receive 100 Token A and 50 Token B in exchange for your 50 Token C.
- The system creates a pair for you in the liquidity pool with your 100 Token A and 50 Token B.
So, in the end, you are able to invest in the liquidity pool with Token A and Token B without having to go through the complicated process of swapping your Token C for them on your own. The CrowdSwap platform handles all of the details for you, making it a simple and easy process. An example from the CrowdSwap app would look like this:
In the example above, the user has chosen WOM/BUSD liquidity pool to invest in. Since the liquidity pool is on the BNB Smart Chain (BSC) network, and the user’s funds (CROWD) are on the Polygon network, a crosschain solution is selected for them. By hitting the ‘Cross chain invest’ button, the system conducts a crosschain swap and creates the liquidity pool with BUSD and WOM tokens. Easy, right? That’s how CrowdSwap makes things easy for its users.
CROWD/USDC LP Farm
CROWD/MATIC LP Farm
CROWD/USDT LP Farm
CROWD/USDC LP Farm
CROWD/MATIC LP Farm
CROWD/USDT LP Farm
Get a hands-on experience with these yield farming options on the CrowdSwap App.
How to withdraw the pool rewards?
Now that you have made your investment using one of the three options provided by CrowdSwap, you can sit back and watch your investment grow. As more people trade the tokens in the liquidity pool, the price may fluctuate, leading to potential profits. And when you're ready to withdraw your rewards, CrowdSwap provides an easy-to-use interface that guides you through the process.
By selecting the option to withdraw rewards from the drop-down menu in your CrowdSwap account, you can easily transfer your earnings directly to your wallet. Simply select the option 'CROWD Reward' from the menu, and the funds will be transferred to the same wallet address you made your investment from.
Just a quick reminder: The tokens you earn as rewards may vary based on the investment opportunity you choose. So, if you invest in a CROWD opportunity, you'll get paid in CROWD tokens, but other platforms might pay you out in different tokens. For instance, PancakeSwap opportunities will give you the rewards in CAKE.
Background processes involved in CS liquidity farming
Alright, so when you're getting in on a liquidity farming opportunity, there's some stuff happening in the background that you may like to know about. So, here's a brief explanation of what happens in the background for all three options:
- "Invest by Pair": You invest in the liquidity pool by using both tokens in the pair. The CrowdSwap platform automatically calculates the ratio between the two tokens based on their market prices and creates a pair in the liquidity pool for you.
- "Invest by Swap": You invest in the liquidity pool by swapping one of the tokens in the pair for the other one. The CrowdSwap platform automatically calculates the ratio between the two tokens based on their market prices and swaps your token for an equivalent value of the other token. Then, the platform creates a pair in the liquidity pool for you.
- "Invest by Crosschain": You invest in the liquidity pool with a token that's not on the same network as the tokens in the pair. The CrowdSwap platform automatically calculates the value of the token you have and swaps it for an equivalent value of the two tokens in the liquidity pool pair. Then, the platform creates a pair in the liquidity pool for you.
In all three options, the CrowdSwap platform handles the calculations and swaps necessary to invest in the liquidity pool. This makes it easier for users to participate in liquidity pools without having to deal with the complexities of token swapping themselves. So, all you need to do is decide to do it!
Liquidity farming can be a pretty sweet way to make some money, but you need to know what you're getting into. Overall, CrowdSwap is a super convenient platform for those looking to participate in decentralized finance. Whether you've got both tokens, only one of the tokens, or a token on a different network, CrowdSwap's got options to make it easy for you to participate in liquidity pools.
By providing user-friendly options and simplifying the investment process, CrowdSwap helps to make decentralized finance accessible to everyone. So, no need to stress about investing in liquidity pools anymore, just hop on over to CrowdSwap and get your investments rolling!
And it's always a good idea to keep tabs on the market conditions and how the tokens in the pool are performing, so you can make smart choices about your investments. Stay on top of things, and don't forget: patience is the key in financial markets!