Find the best yield farming opportunities every month with DappRadar
Yield farming pools offer users a new way to earn rewards with cryptocurrency holdings using permissionless liquidity protocols.
It allows anyone to earn passive income using the decentralized ecosystem of “money legos” built on the Ethereum blockchain.
Every month, DappRadar will take a look at the top yield farming pools, collateral required, and expected annual returns. Pools are ranked by value locked at the time of writing.
BarnBridge
BarnBridge is the latest Ethereum DeFi project. This project aims to mature the DeFi lending and index markets by creating “bond-like” products that divide risk into tranches, allowing investors to specifically choose their risk profile.
BarnBridge is a derivative protocol that combines existing lending rates and yield products into “bonds”. Bonds are offered to DeFi investors at different levels of returns, and the risk is watered down by each product’s risk/yield balance.
Asset: BOND
Pool: Barn Stable Pool
Audits: 1
Collateral: USDC, DAI, SUSD
Expected annual return: 22.19%
Aave
Aave is an open-source and non-custodial protocol enabling the creation of liquidity markets where users can earn interest on deposits and borrow assets.
Staking essentially means depositing AAVE tokens within the protocol Safety Module. The purpose of staking is to act as a mitigation tool in case of a shortfall event. As an incentive to protect the protocol Safety Module stakers will receive AAVE as Safety Incentives (SI).
Asset: AAVE
Pool: Aave Staking
Audits: 3
Collateral: AAVE
Expected annual return: 4.93%
Sushi
SushiSwap is a fork of Uniswap that adds the SUSHI token. It grants control over the protocol to holders and pays a portion of fees to them.
SUSHI is distributed to those who provide liquidity to specific Uniswap pools. Then, they can deposit their Uniswap LP tokens into the SushiSwap staking contracts to start earning SUSHI.
SUSHI is currently offering 5 of the top 10 yield farming opportunities so it is well worth exploring the platform in more detail.
Asset: SUSHI
Pool: SushiSwap
Audits: 2
Collateral: WETH, USDC
Expected annual return: 35.41%
Synthetix Network Token
Synthetix is the backbone for derivatives trading in DeFi, allowing anyone, anywhere to gain on-chain exposure to a vast range of assets.
The sUSD pool was born out of a partnership between Curve and Synthetix who sought to help bring stability to their stable coin sUSD. The pool is not a lending pool which means your main APY comes from trading fees.
The current rewards have no expiry date but can be adjusted by a vote from Synthetix governance.
Asset: SNX
Pool: sUSD Liquidity Guage SCURVE
Audits: n/a
Collateral: SCURVE
Expected annual return: 3.64%
Sushi
SushiSwap is a fork of Uniswap that adds the SUSHI token. It grants control over the protocol to holders and pays a portion of fees to them.
SUSHI is distributed to those who provide liquidity to specific Uniswap pools. Then, they can deposit their Uniswap LP tokens into the SushiSwap staking contracts to start earning SUSHI.
SUSHI is currently offering 5 of the top 10 yield farming opportunities so it is well worth exploring the platform in more detail.
Asset: SUSHI
Pool: SushiSwap
Audits: 2
Collateral: WETH, DAI
Expected annual return: 40.41%
The risks of high APY and yield farming
APY is one of the metrics widely used to assess the project/pool returns within the DeFi ecosystem.
However, when looking at the top yield farming pools be aware that APY should be used cautiously. It is worth keeping in mind that these are only estimations and projections. Even short-term rewards are quite difficult to estimate accurately. Yield farming is a highly competitive and fast-paced market, and the rewards can fluctuate rapidly.
Secondly, the user should always keep in mind that the cost paid for a transaction should not exceed any return on investment.
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