With the onset of a crypto winter apparently upon us, many investors are looking for a place to put their crypto on along term bases. There are, of course, no shortage of DeFi projects that will offer you significant returns on your crypto.
So how does someone choose the right protocol for them? With all these projects promising different returns and lock periods, how does someone have the time to sort through them all?
That’s where yield optimisation protocols like Autofarm come in.
How Autofarm works
Autofarm is a smart contract that searches through DeFi protocols for the highest yield. Investors deposit cryptocurrency into one of the vaults on autofarm.network and Autofarm does the rest.
There are many different yield optimisers but with some of the lowest fees on the market, it’s no surprise that Autofarm currently has more than $60 million locked across all of its vaults.
Any crypto stored in an Autofarm vault will auto compound. This allows investors to leave their investment for years on end as it requires no upkeep.
Autofarm is powered by the native AUTO token. Auto is deflationary. It has a maximum supply of 80,000. Holding AUTO also allows you to benefit from Autofarm vaults and participate in governance.
Autofarm works on multiple chains, available on BSC, HECO, Polygon Avalanche, Fantom, Moonriver, OEC, Celo and Cronos. All of these chains are selected to take advantage of their low fees.
There are three different ways you can benefit from Autofarm.
Single Asset Vaults
Single asset vaults are the simplest. These require only the underlying token to be deposited. Examples of single asset vaults available on Autofarm include WBNB and BUSD.
These vaults will farm Venus tokens, another token native to Autofarm. The Venus tokens will be automatically sold on the market for more of the underlying tokens. This means investors will be receiving returns in the underlying token they deposit.
In other words you can deposit BUSD into these vaults and you will be compounding with more BUSD.
LP Vaults, on the other hand, allow you to provide capital for liquidity pools. By depositing into LP vaults, you will be facilitating decentralized trading across the DeFi ecosystem.
Depositing capital into LP vaults is not as simple, however. It requires you to first obtain LP tokens from PancakeSwap and other decentralized exchanges. One other thing to consider about LP vaults is that you will be subject to impermanent loss so bear that in mind.
Take Advantage of the AutoSwap DEX
Despite starting out as a yield optimizer, Autofarm success soon saw it expand into other areas. Is a new deck concept that will find the best price for token swap from multiple texts on BSC. AutoSwap will also allow users to split their trade across different texts to minimize slippage.
This is just another way that Autofarm aggregates prices across the DeFi ecosystem and allows its users to take full advantage of them.