Putting Pension Funds into DeFi Yield Farming – In the Right Direction?

Before establishing the effects of putting pension funds into DeFi Yield farming, it is also necessary to explicitly explain its connotes. In its simplest DeFinition, yield farming is an option that allows crypto investors to lock their holdings to reap the rewards later on. It is also a process that offers you an opportunity to earn a fixed or variable interest by investing crypto in a DeFi Market. Yield farming involves the lending of cryptocurrency through the Ethereum network. When banks offer loans via fiat money, they expect lenders to pay back the amount they lend out with a certain percentage of interest. It also follows this concept. It lends out a cryptocurrency that should be stored in a wallet following the DeFi protocols to get a return. DeFi Yield farming is carried out using ERC-20 tokens on Ethereum. The rewards also come like an ERC-20 token as well. With a huge potential for this change in the nearest future, the Ethereum ecosystems carry out the majority of the yield farming transactions. How does DeFi yield farming Work? The first thing you need to do in DeFi yield farming is to add funds to the liquidity pool. These are important smart contracts that contain funds. These pools fuel a marketplace where users can easily exchange, lend tokens or borrow. Once you do this, you have become a liquidity provider officially. As a result of you sealing up your funds in the pool, you will be rewarded with generated f...