What is Yield Farming in Crypto and How Does Data Analytics Help?

Major developments in big data technology have helped influence the direction of the cryptocurrency sector, such as with the inception of yield farming.
data analytics and yield farming for cryptocurrency traders
Shutterstock Photo License =- By Iaremenko Sergii

Data analytics has become a major gamechanger for the cryptocurrency industry. Traders and miners have discovered a number of advantages of using big data and AI tools to improve their profitability.

One of the newest applications of data analytics in cryptocurrency mining is with yield farming. Many crypto enthusiasts have found that it can help them lift their ROI considerably and address many of the problems that they face.

Data Analytics Helps Set the Future of Yield Farming for Cryptocurrency Traders

Decentralized finance (DeFi) has lately risen due to new developments like liquidity mining, which is both creative and dangerous. Stick or lending crypto assets to produce significant returns or rewards in different cryptocurrencies is yield farming. As a result of yield farming, the DeFi industry, which is still in its infancy, expects its market valuation to rise to $10 billion by 2020. New developments in data analytics and machine learning have helped accelerate this growth.

To put it simply, yield farming protocols encourage liquidity providers (LP) to stake or lock up their crypto assets in a pool of liquidity based on smart contracts. A part of the transaction costs, interest from the lenders, or a governance token can be used as incentives (see liquidity mining below). These profits are shown as a yearly percentage return (APY). The right data analytics tools can help investors identify the best trading opportunities and solidify their ROI. Investors’ returns fall in value when more money is added to the linked liquidity pool.

Stablecoins like USDT, DAI, and USDC were the most popular choices for early-yield investors. These investors will have an even better chance of achieving profitability if they use data-driven predictive analytics models to properly forecast asset prices. DeFi protocols that are now popular functions on the Ethereum network provide governance tokens for so-called liquidity mining. For the exchange of supplying liquidity to decentralized exchanges, tokens are farmed in these liquidity pools (DEXs).

Data analytics can help with the mining process as well. They can solve the puzzles needed to earn cryptocurrencies a lot more quickly. Big data technology can also help streamline computing resources to minimize energy use and therefore reduce the costs of the mining process.

Yield farming participants that gain token incentives as an additional remuneration are said to be engaged in liquidity mining, which became popular after Compound began releasing its rapidly rising governance token, COMP, to its platform users. This has been one of the biggest breakthroughs in the use data technology in cryptocurrency mining.

Liquidity providers in yield farming protocols are now typically rewarded with governance tokens, which can be exchanged on centralized exchanges like Binance and decentralized exchanges like Uniswap.

With 123yield, you’ll be the first. By participating in staking, users may take data-driven approaches to mining and earn incentives as they utilize the network. An increasing range of PoS and DPoS assets may be safely staked by users while also receiving 123 tokens as additional incentives. Many cross-chain assets may be earned by staking the users’ 123 tokens. The platform aggregates user stake interests, which then delegates assets to approved validators on their behalf.

It’s a peer-to-peer crypto asset exchange platform that works seamlessly. 123swap uses the collective expertise of the crowd to build a web 3.0 economy that is transparent, community-governed, and decentralized. Because of this, it is based on the Binance Smart Chain.

The 123swap platform is self-funded to a large extent and requires oversight to proceed. It means that the pre-sale will be the primary selling period for tokens. Both the general public and venture capitalists will have equal rights. To save and build money jointly, 123swap offers individuals financial power back.

123yield is easy to use, safe, and devoid of complications. No action is required on behalf of the users, who can stake their 123tokens every day and earn USDT incentives in return. Because of this, the platform keeps a tiny portion of the profit to meet the considerable operational, technological, and legal expenses.

Developments in Big Data Technology Have Helped Improve Cryptocurrency Mining

There is no question that big data has had a huge influence on the direction of the cryptocurrency industry. The DeFi industry, which is still in its infancy, expects its market valuation to rise to $10 billion by 2020. The evolution of data analytics technology has played a huge role in this process.

123swap is a peer-to-peer crypto asset exchange platform that works seamlessly. 123swap uses the collective expertise of the crowd to build a web 3.0 economy that is transparent, community-governed, and decentralized. Yield farming protocols encourage liquidity providers (LP) to stake or lock up their crypto assets in a liquidity pool based on smart contracts. By participating in staking, users may earn incentives as they utilize the network, which is one of the biggest opportunities for data-driven cryptocurrency miners and traders.

The pre-sale will be the primary selling period for tokens. For every stake a user makes with the help of another user’s link, another user receives 10% of the staked money. Because of this, the platform keeps a tiny portion of the profit to meet the considerable operational, technological, and legal expenses.

Dariia Herasymova
Dariia Herasymova is a Recruitment Team Lead at Devox Software. She hires software development teams for startups, small businesses, and enterprises. She carries out a full cycle of recruitment; creates job descriptions based on talks with clients, searches and interviews candidates, and onboards the newcomers. Dariia knows how to build HR and recruitment processes from scratch. She strives to find a person with appropriate technical and soft skills who will share the company's values. When she has free time, she writes articles on various outsourcing models for our blog.