There’s this Indian dish, khichdi, a nourishing blend traditionally made with rice, mung beans, and aromatic spices like turmeric, cloves, and cardamom.
It makes you feel good and is a guilt-free meal that can easily be prepared in bulk.
This past week, I decided to make a variation of it with sprouted mung beans and quinoa. Doing so reminded me of yield farming, a new investing strategy within crypto I’ve been delving into.
Yield farming can be hard to get so maybe thinking of it in terms of bean sprouting can help you start.
If you’ve ever sprouted, you’ll know how fun the process is. You start with many hard, closed seeds/legumes/beans and end up with an abundance of almost plants.
Mung beans are the easiest to sprout — you take a cup of them, clean them out, and leave them soaking in water overnight. You’ll start to see shoots the very next day, and you just keep rinsing and repeating till you get your desired sprout level.
You’ll need to soak the legumes in a bowl or dish twice as big as it would normally fit in unsprouted, because of how they rapidly expand. You could start with a ¼ cup worth of mung beans and end up with 1–2 full cups of sprouted plants after the process.
The health benefits are clear. Sprouting boosts the B-vitamin content of the bean astronomically and makes the nutrients more bioavailable.
You don’t need any fancy equipment to get started, and you still reap the bountiful benefits with little effort.
This is why it reminds me of yield farming so much. To take advantage of high returns, all you need is an internet connection and willingness to learn.
Now, most people don’t know what yield farming is and that’s understandable. It’s a relatively new strategy but being ignorant about this is still a deficiency. Anyone with access to the internet should be learning more about the decentralized finance (DeFi) movement within the crypto space.
Especially if you’re in my generation, here’s why: yield farming allows you to 10x your money with little to no effort, kinda like sprouting. Yield farming is simply maximizing your rate of return on your capital. You leverage the money you already have and grow it.
Think of it like starting with that ¼ cup of beans, and ending up with 1 cup full of sprouted goodness.
Yield farming is done through various DeFi protocols, allowing for new streams of wealth and opportunity where you can achieve an APY (annual percentage yield) as high as 100% or more. That’s not a typo.
You can earn 100% a year by doing nothing except providing liquidity to a certain crypto pool. You get rewarded through fees and governance tokens.
I know this sounds far-fetched, but consider the case of accredited investors today which is legal speak for rich rich people who are deemed sophisticated enough by the SEC to decide what to do with their own money. Those accredited investors get early access to stocks like Beyond Meat before it’s made available to us regular people on Robinhood. They see returns like 100% or higher because of their early access entry point.
Most of the world isn’t able to benefit from that because we aren't allowed in.
Yield farming allows you to get that early advantage with crypto projects. And it doesn’t discriminate.
Yield farming is algorithmically sound — taking human error and bias out of the equation.
DeFi shows no signs of slowing down — the TVL (total value locked) in the space is over $68 billion. This is a new money movement.
With traditional finance, you’re LOSING money if you leave it sitting in a bank account even if it’s a savings account because the APY is so pitiful. 0.1% per year doesn’t even match inflation rates.
It’s time to take sovereignty back over your money and make smart decisions on how to grow it.
The way that I understand yield farming, you put $1000 towards a protocol whose technology and mission you value (and have researched) and allow it to work for that organization in a win-win scenario. You end up with $2000 (uncompounded) at the end of the year.
The organization requires liquidity, and you provide that with your $1000 worth of tokens. You win by getting rewarded through fees and/or governance tokens.
That’s how these hard-to-fathom yields work: it’s baked into the code.
I’ve been yield farming for 2 months now ever since I learned about it, and like bean sprouting, more people deserve to be in on this.
It takes learning and educating yourself of course but it’s so worth it.
Please don’t shy away if you count yourself financially unsavvy.
In fact, if you don’t have a traditional finance foundation, crypto will be your gateway to finally getting it. I think learning crypto will be easier and stronger to build upon — allowing you to understand the current system and what you can do to set yourself up for success.
It’s never too late to start.
Bankless has been my favorite education tool so far. Start with their first 7 episodes to lay a foundation. You can also watch this video to understand the concept a little more. All Finematics’ videos are awesome to learn :)
And once you consider yourself ready to take a gander at yield farming, Kyle made a tutorial on how to do so on your phone.
Remember, sprouting and yield farming are both good for you. They allow you to take back sovereignty over your nutrition and money, and the process is fun. You don’t need fancy equipment to get started with either, just willpower and an appetite.
You hungry?
Note: I’m not a financial advisor, just a DeFi enthusiast. Please do your own research before deciding what to do with your money. Yield farming is a high risk, high reward scenario but at least you have a choice to partake in a new movement behind your money now. Never stop learning :)
