I did a few searches and have looked into Uniswap, Alpha Finance and Yearn
My questions are
1. If I pair LINK to USDC, it looks like I have to provide USDC equivalent to a portion of the LINK I provide, i.e. I provide 311.8 LINK currently worth 5000 USD and I will need to also provide 3500 in USDC to maintain liquidity. Is this a correct assessment?
2. if the trajectory of LINK is downwards towards zero, is there a risk of the smart contract liquidating my position?
3. Are the risks in providing liquidity and staking all dependent on the security of depositing the assets and the security of the service such as Uniswap?
4. What is more lucarative while holding tokens?
5. would this be stupid to do?
3 thoughts on “What to do with a few hundred LINK i’m holding with my cold wallet? I’m interested in yield farming and/or liquidity providing, couple of questions about the process”
There’s tons of defi opportunities for LINK without having to expose yourself to impermanent loss. I was getting over 50% APR on LINK on YAXIS until about two weeks ago, I’ve since moved on to other protocols as Yaxis is now down to like 12% APR. The best ones will not be openly advertised as that would dilute yields. You have to know where to look and be checking all the time. LINK is probably the best form of pristine collateral tbh since it’s used way less than ETH or BTC and hence generally has much higher APRs on protocols (and every protocol uses LINK so it’s an easy thing for them to implement). I was printing a shit load of money on Benqi and TraderJoe for months with my LINK on AVAX last fall/winter for example
Bancor always has great yields but never room in the pools. Familiarize yourself with protocols on all the best layer 1s (AVAX FTM LUNA ONE etc and layer 2s Arbitrum Optimism and MATIC etc) there’s always good yield for LINK holders. If you want an easy set and forget, just bridge it to FTM and deposit it in the single asset Beefy finance vault for LINK which uses Scream
If you have 5k in link you need 5k in usdc.
If you’re very bullish on link and think it’ll skyrocket the gains you get from a liquidity pool could be less than just holding link.
Farm on animalfarm with it 500% apy