What is the Difference Between Farming & Staking?

[DanielBroonze]

Hello.. All. We all are Familiar with Staking & Farming but i want's to know about the difference between these two. And Which one is best for a Good Investment?

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[crwth]

I always have thought of it as the same, so I did a quick Google on this to find out the differences in general. We are comparing Yield Farming to Staking.

- Yield farming or liquidity mining, you temporarily lend crypto assets in a permissionless way.
- Staking is you lock up assets and act as a node, and there you confirm blocks in the blockchain.

Yield farming has higher risks but has bigger APY, while Staking has lower APY and has lock time.

I guess that's where you can compare the two. For a better investment, it depends on the money you are going to use. Is it going to be set aside and not needed right away? Or something that you need to liquidate right away? I think that's the better question.

[lumierre]

Hello.. All. We all are Familiar with Staking & Farming but i want's to know about the difference between these two. And Which one is best for a Good Investment?

The difference is that in staking you have to lock up only one asset.
And in farming you create a pair of your tokens and then this pair you lock up in the  smart-contract of defi-project. Yeild farming is more risky as in addition to the risk of hack of this platform there is a risk of impermanent loss that means that your two tokens change the price relative to each other.

[FinneysTrueVision]

I always have thought of it as the same, so I did a quick Google on this to find out the differences in general. We are comparing Yield Farming to Staking.

- Yield farming or liquidity mining, you temporarily lend crypto assets in a permissionless way.
- Staking is you lock up assets and act as a node, and there you confirm blocks in the blockchain.

Yield farming has higher risks but has bigger APY, while Staking has lower APY and has lock time.

I guess that's where you can compare the two. For a better investment, it depends on the money you are going to use. Is it going to be set aside and not needed right away? Or something that you need to liquidate right away? I think that's the better question.

You're describing proof of stake but there is also a different kind of staking. You can stake coins by locking them in a smart contract. For example Pancakeswap has Syrup Pools where you stake CAKE and earn more CAKE or other coins. The benefit of staking is that there is no risk of impermanent loss but your returns will diminish over time. Other decentralized exchanges have their own equivalent to syrup pools.

[Kemarit]

I always have thought of it as the same, so I did a quick Google on this to find out the differences in general. We are comparing Yield Farming to Staking.

- Yield farming or liquidity mining, you temporarily lend crypto assets in a permissionless way.
- Staking is you lock up assets and act as a node, and there you confirm blocks in the blockchain.

Yield farming has higher risks but has bigger APY, while Staking has lower APY and has lock time.

I guess that's where you can compare the two. For a better investment, it depends on the money you are going to use. Is it going to be set aside and not needed right away? Or something that you need to liquidate right away? I think that's the better question.

You're describing proof of stake but there is also a different kind of staking. You can stake coins by locking them in a smart contract. For example Pancakeswap has Syrup Pools where you stake CAKE and earn more CAKE or other coins. The benefit of staking is that there is no risk of impermanent loss but your returns will diminish over time. Other decentralized exchanges have their own equivalent to syrup pools.

Yeah, so the risk is higher as well. And in the beginning this staking was offering huge APY so mostly a lot of investors enter the picture and join the hype. But those projects simply decrease APY throughout in the next coming months so currently it's very low so I don't know if it still worth to stake your coins or just swap them and continue to trade.

[RussianEnglishTranslation]

You can stake and yield farm at the same time on NEAR protocol metapools. You deposit NEAR to get stNEAR, which is like stETH and it can be used in DeFi. You also earn META tokens by staking.

[DapanasFruit]

Hello.. All. We all are Familiar with Staking & Farming but i want's to know about the difference between these two. And Which one is best for a Good Investment?

The difference is that in staking you have to lock up only one asset. And in farming you create a pair of your tokens and then this pair you lock up in the  smart-contract of defi-project. Yield farming is more risky as in addition to the risk of hack of this platform there is a risk of impermanent loss that means that your two tokens change the price relative to each other.

I am also confused with these two important opportunities especially in many DeFi platforms. Good to be clarified with the difference in them - staking and farming. I am not yet involved in them both because I am afraid of the possible risks involved. I once lost my BNB to a scam site that's why there is that part of me that is always hesitate to join especially with newer projects that have still to prove their worth. I understand that there can be good money to be made in both strategies...it can be a matter of finding a platform that is really trustworthy which is a big "drought" here in this industry.

[amishmanish]

Farming is basically Yield Farming by providing Liquidity for new projects (many of which are simply scams). Basically, you buy a project's own token and an equal amount of an established token like BTC, ETH, USDC. You lock up these into a smart-contract which provides your tokens into a liquidity pool which others can buy from and sell into. This is called Market Making and AMMs like Uniswap, Sushiswap provide platforms for these. In return, you get a portion of the fees as well as the native tokens. Yield farming exposes you to Impermanent Loss.

In staking, all you have to do is buy up tokens of project (thus increasing its value) and then lock them into a staking contract. Locking the tokens means they are not available for trading. This creates scarcity and increases value. In return, you get rewarded with the native tokens itself. Staking is considered safer for newbies if you are lucky enough to find a legitimate project in the beginning. Staking rewards are generally lower than LP/ Farming rewards.

[Pelana vreo]

Hello.. All. We all are Familiar with Staking & Farming but i want's to know about the difference between these two. And Which one is best for a Good Investment?

https://www.certik.org/blog/whats-the-difference-between-staking-yield-farming-and-liquidity-mining.

You can see the article above, there are many DeFi platforms that offer Farming and staking, make sure you have enough time to see the coins you want to stake because some DeFi platforms have a duration of time for staking coins, for example 30 days,60 Days and ext.

[lizarder]

Hello.. All. We all are Familiar with Staking & Farming but i want's to know about the difference between these two. And Which one is best for a Good Investment?

Both affect the act of investing, but we must understand the function and placement of both, the investment world is inseparable from staking and farming, this is almost close to proper investment preparation, but take advantage of these conditions if there is a match in running it, or only use one of them.

I personally prefer staking in investing, but according to the investment needs that I do and sometimes what I do does not match the investment patterns of others, that's why if you have to choose, the right answer is according to each individual's needs.

[kbhutto]

The difference between Steking and farming
If staked with the system saves into a digital wallet within a certain time after the platform will stake using the crypto asset savings of the user,
while farming is an activity where users can save crypto assets and lend to other users then get results in the form of crypto assets

[dhemasm]

I prefer staking even if it could have lower returns, but delegating for example ADA to accumulate a 4/6% of ADA coins is preferable rather than delegating the ETH / DAI pair and risking having impermanent loss due to the volatility of ethereum

Yeah, staking it's much better since it's only affected by the price while Farming it's much complicated and more risky but i think it's depends on the Pairs itself, For the example you are mentioning ETH/DAI pair which is both of them it's top altcoin on the market right now and risk itself it's much lower comparing to other Farming Pair especially a new one so i suppose Farming it's much better if the Pair itself was some of Top Coins like ETH/DAI.

[jostorres]

We all are Familiar with Staking & Farming but i want's to know about the difference between these two. And Which one is best for a Good Investment?

It depends on what you’re looking for. They might be kind of similar, but there still a difference between the both of them. In staking you have to lock up one asset and there isAPY you earn in return. This varies depending on the crypto you’re staking. And sometimes when you stake a token that is owned by the platform you’re making use of, you’re going to earn more APY than when you’re staking a token that doesn’t belong to them.

Take for example if you stake on Crypto.com and stake their token, you get over twenty percent, but when you’re staking bitcoin, you get around six percent or so. Same thing with Binance when you stake their BNB, you get 23% APY.Farming is also good it you can understand it, but it has more risk than when you’re staking.

[Ridi]

Difference between Farming and Staking:-

Farming focuses on gaining the highest yield and on the other hand whereas staking focuses on helping a blockchain network stay secure and In staking you have to lock up one asset Both have their advantages and disadvantages.

[NFTshill30055]

Yield farming is a newer concept than staking, though the two share many similarities. While staking can refer to actions such as locking up 32 ETH to become a validator node on the upcoming Ethereum 2.0 network, yield farming refers more exclusively to providing liquidity to a DeFi protocol in return for yield.