Yield Farming
It is one of the most trending topics in defi space as it promises huge rewards. In yield farming, holders have to lock up their tokens for rewards. Another example of yield farming is, providing liquidity, as many projects require liquidity in their started phase to facilitate swaps. Farmers earn their native tokens as a reward.
Most of the people get attracted by these, as they offer much higher interest than traditional Fiat banks and many users aspire to get early so that they could earn more tokens.
What are the risks in yield farming?
Users who choose projects which are base on Ethereum network, have to pay high amount of fees. So that small player's in the market have to wait for a long time to get their investment
As crypto is highly volatile in nature, project native tokens may fall drastically and you may not get good returns
Many crypto projects are only made to steal your hard-earned money. Firstly they create hype by promising huge rewards and after getting investors fund, they disappear