Yield farming is the process of token holders maximizing rewards across various DeFi platforms.

Users lend or borrow crypto on a DeFi platform and earn cryptocurrency in return for their services.

Yield farmers who want to increase their yield output can employ more complex tactics. For example, yield farmers can constantly shift their cryptos between multiple loan platforms to optimize their gains.

How does yield farming work?
Yield farming allows investors to earn yield by putting coins or tokens in a decentralized application, or dApp. Examples of dApps include crypto wallets, DEXs, decentralized social media and more.

Yield farmers generally use decentralized exchanges (DEXs) to lend, borrow or stake coins to earn interest and speculate on price swings. Yield farming across DeFi is facilitated by smart contracts — pieces of code that automate financial agreements between two or more parties.
Next will we look at some quick facts about yield farming and the different types of it.
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