Tezos DeFi Series Part 2— How to farm on Tezos
Part 2 of the Tezos Series is an introduction to cryptocurrency farming on Tezos. You will learn what is farming and how it works. We created a unique Tezos token, the “Tezard Coin” to showcase how farming actually works and where to start.
Please note that the Tezard Coin has no rights attached to it or whatsoever. It’s solely an educational token. Investing in cryptocurrencies, using DeFi protocols etc. can bear high risks and can lead to a total loss of coins or investment. Please do your own reseach, this article is just a technical review and no investment advice.
Good, as we got over that, let’s start!
Recap — What we learned in Part 1 of the Tezos DeFi series:
How to fund your Tezos web wallet (Temple wallet) and how to use the decentralized exchange Quipuswap on Tezos. Link below if you missed it:
Part 2 of the Tezos DeFi Series: About Farming on Tezos — What is faming on Tezos?
Farming in general allows cryptocurrency or token holders to earn rewards by locking up their crypto holdings in a DeFi protocol. This can be the token itself or liquidity pool tokens (LPs), after you provided liquidity to a certain asset on a decentralized exchange (DEX). How to add liquidity to the Quipuswap DEX was part of the Tezos DeFi Series Part 1 (link above).
What is a good point to start farming on Tezos?
Today we want to introduce you to “Crunchy”. Crunchy is a Defi-as-a-Service plattform built on Tezos. The plattform makes it easy to participate in certain farming pools or create your own farm. Creating your own farm will not be part of this article, but we will do a tutorial on this topic in an other series.
Below you find the link to the Crunchy website:
How does the Crunchy DeFi App work?
First let’s have a look on the Crunchy App!
Go to the website an click “LAUNCH APP”
Click on the section “Farms” to see all available farms. That are all farms you can farm tokens.
To participate in farming you need to stake a certain type of liquidity token (LP) or asset to receive an asset/token as reward.
For example (in line 1) you need to stake XTZ/wWBTC to get crDAO as a reward. That means you need to get the certain liquidity pool tokens (LPs) in advance to earn the rewards. In that case you need to get XTZ/wWBTC LP tokens in advance. Sound difficult? No it’s not, we will explain it step-by-step.
How to farm crypto on Crunchy?
Now let’s go through it step-by-step. These things need to be done:
- Add Liquidity — Get liquidity pool tokens
- Connect your wallet to Crunchy
- Choose your farm
- Stake
How to get liquidity pool tokens?
In series 1 we described how to add liquidity to Quipuswap. That’s the starting point also here. So first we add liquidity to a certain liquidity pool on Quipuswap. For this tutorial we will use the Tezard Coin Liquidity pool.
Contract Address of the Tezard Coin: KT1RhRYoGmhDr4DShdggQqumRAhwAETxrs3t
You can use every other liquidity pool you want to, but make sure there is a Crunchy farm for that liquidity pair.
For the Tezard Coin we created a farm on Crunchy, that’s why we can proceed here.
First we need the base token, in our case the Tezard Coin.
So go the swap section of Quipuswap and select the coin you prefer, choose the amount and click “Swap”.
The next step is to get liquidity pool tokens for staking. To get them you need to add liquidity to Quipuswap. Go to the “Invest” section and add the liquidity. If you have problems, read part 1 of the Tezos Defi series.
After you now have provided liquity let’s get back to Crunchy.
How to connect to the Crunchy DeFi App?
Just click connect your wallet in the right upper corner.
How to farm on the Crunchy DeFi App?
Farming on Crunchy is easy. You just need sot select “Farms” in the left section. Now you see all farms, gardens etc. (maybe you have to dismiss the filter on farms and gardens to see all). Now select the farm you want to start farming with.
Click the “Expand all” button in the right section, to open the drop down. You now see the big “+”. That’s how you add your LP tokens to the farm. Click it.
After you clicked the “+” button you see that you can add your liquidity tokens to your farm. Select the amount and click “Stake”.
A blockchain transaction will be conducted. Confirm it and wait for the confirmation. After it’s done you will see your share of the farm.
🎉That’s it! You are now participating in the Tezos farming on Crunchy. How to harvest your rewards will be part of the next series!
Why is farming on the Tezos protocol good?
Tezos is a state of the art blockchain protocol using a proof of stake algorythm to secure the network. Proof of stake is an energy efficient way to run a blockchain. That means that what Elon Musk says about Bitcoin is not applicable for Tezos ;-)
Also the fees for conducting blockchain operations (network fees) are quite low compared to other blockchain protocols like Ethereum.
What comes next?
This tutorial is one of the first explanations and walktroughs of the Tezos DeFi universe. The next series will be about other DeFi protocols on Tezos. The tutorials will be listed also here.
Part 1:
Follow us on Medium or Twitter for the next series and updates:
Medium:
Twitter:
https://twitter.com/tezard_tezos
For more information on Tezos and to find the best exchanges visit:
Kind regards
Tezard
— You shall not parse! —
Disclaimer: Please note that this article is only a technical review. There is no investment advice given here. Please note that investing in cryptocurrencies can involve high risks. The reviews are based on our opinion. Please verify the exchanges on your own. Buying and storing cryptocurrencies on an exchange involve risks. Please inform yourself on the risks of cryptocurrencies. The term “passive income” means that you will be rewarded with Tez by participating in the network. If you can earn money depends on the current market prices of the Tezos coin, which can not be foreseen. Also using centralized or decentralized exchanges can result in a total loss of your assets. Do your own research on everything! Please note that the Tezard Coin has no rights attached to it or soever. It’s solely an educational token. Investing in cryptocurrencies, using DeFi protocols etc. can bear high risks and can lead to a total loss of coins or investment. Please do your own reseach, this article is just a technical review and no investment advice.