Decentralized finance has opened the doors to many new capabilities that the everyman can tap into with ease that was not possible before. Not only is it poised to make the world of banking and finance more accessible, but it's been able to leverage lucrative earnings and profitability that the average joe or jane could never think was in reach. One of them is yield farming, and today we're going to take a peek at the highest APY yield farms on Ethereum, seeing what it can offer.
What is yield farming, you might ask? In the simplest terms, you're undertaking a contract to lock up and lend out your cryptocurrencies to other users in return for fees and interest. Through this, you're continually farming for yields as you let your crypto assets do all the work for you. It sounds quite simple. Yet, as most of even the top interest-bearing accounts and saving rates in the US could barely top 0.5%, the highest APY yield farms on Ethereum can dole out millions of percent in gains.
Risk vs Returns
Before we could get into showing you all the goodies that lurk behind the highest APY yield farms on Ethereum, we should, of course, explain more about this seemingly magical phenomenon. Yield farming isn't a singular instrument, as some might imagine. The act of ‘farming for yields' is a broad spectrum, and one that can encompass pooling tokens into decentralized exchange liquidity pools, providing collateral through lending and borrowing platforms, staking rewards, and so much more.
The idea at its core is still the same – locking up your tokens so that other users can access them for liquidity, and you get to earn fees or rates as a reward. And might we add just before you continue, we should also mention the risks. The higher the rewards, the higher the risks. With DeFi, there's no doubt that the usual “is this a scam” or “are they going to get hacked” sort of due diligence ought to be done in any circumstance and with every DeFi-bound protocol. But there's more.
With yield farming, the biggest that you have to worry about is the market itself – which no one can feasibly control – in the form of ‘impermanent loss‘. This is where the market prices of the tokens that you've deposited have changed, which could result in you getting less dollar value during the withdrawal than at the time of deposit, as the underlying algorithms readjust. Nevertheless, this loss should be easily covered up once you start earning the oft high yields within those farms.
The Highest APY Yield Farms on Ethereum
Ethereum has been the poster child of DeFi – or decentralized finance – where more than $60-billion in total liquidity is locked (at the time of writing) in the many services and platforms that are built and powered by its blockchain. With so much money flowing into Ethereum, there's certainly no such thing as a lack of choice when picking which pool you'd like to farm yields from. Since its nascent creation, there have since arrived dedicated yield farming optimizers and aggregators.
These protocols – which we'll cover in great detail here – are designed for hunting down the best farms across all of Ethereum-borne DeFi for yields. Moreover, they've also built special tools on top of that, such as offering auto-compounding functionality to best maximize your profits. Regardless, there are bountiful options aplenty for yield farming here, and here is just a small list of the top and highest APY yield farms on Ethereum…
1. Alpha Homora
It might be interesting that before we get into some of the more popular DeFi protocols on this list, perhaps we'd take a peek at a more obscure option. Still, Alpha Homora is no minnow, having more than $1.3-billion in total liquidity locked within its platform. They aptly call themselves the first leveraged yield farming service and thus allowing all participants – including you yield farmers – to take on a bit of leverage to increase your investments' exposure, and thus the potential upsides.
With over 42 different pools to choose from and countless more token pairs, you can't say you don't have options to pick from. And that's just on their V1 protocol, as an updated and re-optimized Alpha Homora V2 has an additional 17 pools, now with a bonus boost for early users. In the end, whichever version you might prefer, Alpha Homoro and its farms is a great way to start off this look at the highest APY yield farms on Ethereum.
- ETH-CRV (SushiSwap) – 156.83% APY (34.92% Yield Farming, 120.16% Trading Fees, 8.37% Alpha Rewards)
- ETH-USDC (SushiSwap) – 97.74% APY (27.34% Yield Farming, 66.90% Trading Fees, 16.69% Alpha Rewards)
- ETH-DAI (SushiSwap) – 88.89% APY (47.42% Yield Farming, 38.03% Trading Fees, 16.69% Alpha Rewards)
- ETH-USDT (SushiSwap) – 70.82% APY (31.63% Yield Farming, 35.75% Trading Fees, 16.69% Alpha Rewards)
- ETH-MTA (mStable) – 68.69% APY (58.75% Yield Farming, 9.94% Trading Fees)
- ETH-SUSD (SushiSwap) – 67.06% APY (47.42% Yield Farming, 16.24% Trading Fees, 16.66% Alpha Rewards)
2. Harvest Finance
Another awesome yield farming optimizer that's working hard around the clock on the Ethereum network would be Harvest Finance, with more than $280-million in total liquidity and counting. Just to prove how much automation through specialized tools like Harvest has impacted investments, users have collectively saved more than $50-million in gas costs that would otherwise be spent on individually compounding and reinvesting your returns, among other manual transactions.
This is spread across an immense field of over 100 different farms to pick from on Harvest Finance, not to mention the fact that it's another multichain protocol that's fetched the best pools from across Ethereum and the Binance Smart Chain altogether. Within Ethereum alone, you can sort those farms by categories, such as those that are NFT or Stablecoin-focused, as well as separating them based on which DeFi protocol those farms are found on, such as SushiSwap or from Curve.
- ROPE20-ETH (NFT) – 1,248% APY (0.44% Original LP APY, 1,247.56% Auto-Compounded And Boosted)
- DUDES20-ETH (NFT) – 768.87% APY (0.78% Original LP APY, 768.09% Auto-Compounded And Boosted)
- MEMES20-ETH (NFT) – 744.75% APY (1.01% Original LP APY, 743.74% Auto-Compounded And Boosted)
- GPUNKS20-ETH (NFT) – 641.96% APY (0.93% Original LP APY, 641.03% Auto-Compounded And Boosted)
- MCAT20-ETH (NFT) – 471.30% APY (0.41% Original LP APY, 470.89% Auto-Compounded And Boosted)
- LFBTC-LIFT – 161.36% APY
- WBTC-LFBTC – 123.29% APY
- WBTC-ETH (Uniswap V3) – 83.11% APY
3. Curve Finance
Curve Finance is among the biggest DeFi protocols, clearing its way into the top five for total liquidity and liquidity locked, standing at more than $7.3-billion. Although its homepage and user interface might seem a bit daunting, as though you're forced to navigate through DOS, there's plenty to do within its decentralized exchange. You could be swapping around and exchanging from dozens of different tokens. On top of that, there are the liquidity pools where all that liquidity derives from.
Each one allows users to pool together their token pairs and earn hugely rewarding fees in return. If that's somehow not enough, what investments you have in there could see a huge boost thanks to you holding and staking Curve's native CRV tokens. These can be staked in a number of ways, such as how locking in $1 of CRV could turn that into $20.51 after 4 years, or to use it to earn extra bonuses on top of your already profitable yields from the farms you'll find on Curve.
- bbtc (BBTC-sbtcCrv) – 28.36%-70.90% APY (Base: 8.01% APY)
- frax (FRAX-3Crv) – 21.47%-53.68% APY (Base: 0.96% APY)
- eurs (EURs-sEUR) – 19.62%-49.06% APY (Base: 0.51% APY)
- musd (mUSD-3Crv) – 16.01%-40.03% APY (Base: 1.2% APY)
- reth (ETH-rETH) – 15.26%-38.16% APY (Base: 2.94% APY)
- lusd (LUSD-3Crv) – 13.77%-34.44% APY (Base: 0.85% APY)
- usdn (USDN-3Crv) – 12.40%-31.00% APY (Base: 2.74% APY)
- busdv2 (BUSD-3Crv) – 12.29%-30.73% APY (Base: 3.2% APY)
Uniswap has long been the go-to decentralized exchange for all things DeFi on Ethereum, proven by there being over $6.2-billion in total liquidity locked. Entrusted by users, there's not much to say about Uniswap, as it's quite a simple and no-nonsense platform. There's only that exchange side of things that's worthy of discussion. But it's that simplicity that has made it so popular, and with so much liquidity floating around, you'd be certain to find the most competitive swapping rates.
This has also made it among the most popular destinations for would-be liquidity providers, seeking liquidity pools into which they could pool their cryptocurrencies while at the same time netting huge rewards. Uniswap is, therefore, a great consideration if you're shopping around to find and farm the best yields. Here are some examples for our guide on the highest APY yield farms on Ethereum.
- EPAY-ETH – 3,113% APY
- eMAX-ETH – 297% APY
- KISHU-ETH – 262% APY
- SHIB-ETH – 175% APY
- HEX-ETH – 172% APY
- WOO-ETH – 162% APY
- ETH-AMP – 137% APY
SushiSwap was originally born as a fork of Uniswap and had initially carried over its functionality. As such, it could manage token swapping and liquidity pooling on the flip side. However, they soon rapidly grew, and SushiSwap is now a very expansive and diverse protocol with everything you need out of DeFi accessible through it. There's that DEX, as with before, not to mention its own dedicated yield farms, staking, lending and borrowing, and a whole lot more.
So, despite some of its yields not being as attractive as its brethren, the opportunities for you to diversify your investments are a lot wider, moving your cryptocurrencies from one instrument or token pair to another based on their returns. The possibilities are endless, and thus why SushiSwap is another great place to look out for whenever you're in the mood to do a bit of yield farming, and a great way to cap-off our look at the highest APY yield farms on Ethereum.
- ETH-SUPER – 473.95% APY
- BAC-WETH – 487.69% APY (40.65% Monthly, Or 1.35% Daily)
- RULER-WETH – 151.97% APY (12.66% Monthly, Or 0.42% Daily)
- ICHI-WETH – 142.91% APY (11.91% Monthly, Or 0.40% Daily)
- OHM-DAI – 141.31% APY (11.78% Monthly, Or 0.39% Daily)
- BASK-WETH – 140.60% APY (11.72% Monthly, Or 0.39% Daily)
- WETH-ALCX (Yield Farm) – 281% APY
- SDT-WETH (Yield Farm) – 136% APY
In short, this concludes our round-up on a highlight reel of the highest APY yield farms on Ethereum, and which farms you can look out for specifically. This is, of course, by no means an exhaustive list of all the amazing DeFi protocols out there on Ethereum, with each of them being great investment opportunities for when you need to put your crypto to work. Once you've done that, just sit back and relax, as you watch your retirement fund grow to unimaginable heights.