FLAP FARM ON #BSC
To celebrate the launch of the IgniSwap DEX in BSC, Flama is launching a FLAP Farm!
What is Yield Farming?
Yield farming, also referred to as liquidity mining, is a way to generate rewards with cryptocurrency holdings. In simple terms, it means locking up cryptocurrencies and getting rewards.
In some sense, yield farming can be paralleled with staking. However, there’s a lot of complexity going on in the background. In many cases, it works with users called liquidity providers (LP) that add funds to liquidity pools.
What is a liquidity pool? It’s basically a smart contract that contains funds. In return for providing liquidity to the pool, LPs get a reward. That reward may come from fees generated by the underlying DeFi platform, or some other source.
How does Yield Farming work?
Yield farming is closely related to a model called automated market maker (AMM). It typically involves liquidity providers (LPs) and liquidity pools. Let’s see how it works.
Liquidity providers deposit funds into a liquidity pool. This pool powers a marketplace where users can lend, borrow, or exchange tokens. The usage of these platforms incurs fees, which are then paid out to liquidity providers according to their share of the liquidity pool. This is the foundation of how an AMM works.
How are Yield Farming returns calculated?
Typically, the estimated yield farming returns are calculated annualized. This estimates the returns that you could expect over the course of a year.
Some commonly used metrics are Annual Percentage Rate (APR) and Annual Percentage Yield (APY). The difference between them is that APR doesn’t take into account the effect of compounding, while APY does. Compounding, in this case, means directly reinvesting profits to generate more returns. However, be aware that APR and APY may be used interchangeably.
Increase rewards by Farming!
Contribute to FLAP liquidity and get FLAP-BNB Liquidity Pool tokens. You will receive trading and lending fees + extra rewards if you stake your liquidity!
The first thing to do is to contribute liquidity to the FLAP-BNB pool to get IGNI-LP tokens.
To do so, you’d need both FLAP and BNB tokens in a 50/50 ratio.
You can manually add both tokens to the pool and then deposit them to staking or you can deposit directly with BNB only (See below).
Deposit LP to the Farm
Approve your FLAP-BNB LP tokens for staking.
Then deposit them into the smart contract.
Stake your LP tokens to earn FLAP!
Deposit BNB only
The FLAP Farm allows users to deposit BNB directly to the farm.
The smartcontract handles all the work for you through the function “Farm with BNB”:
1. Select the amount of BNB to deposit to the farm.
2. The smartcontract calculates how many FLAP are needed and buys them through our DEX, IgniSwap.
3. It then adds an equal amount of BNB and FLAP to the IgniSwap Liquidity Pool.
4. Finally, it deposits the IGNI-LP tokens to the farm and starts generating FLAP rewards.
Claim or Reinvest
Rewards get accrued on every block (~3 seconds).
Users can claim their accumulated rewards at any time.
They also have the option to reinvest their rewards to increase their farming stake with only 1 click:
1. The smartcontracts sells the rewards to market for BNB.
2. Adds an equal amount of BNB and FLAP to the IgniSwap Liquidity Pool.
3. Deposits the LP back to the farm and increases the farm stake.
Users that reinvest will withdraw more LP tokens that they initially deposited, allowing them to compound their rewards!
You can withdraw your stake at any time.
To do so, click Withdraw and hit the Max button to withdraw everything.
You will receive the LP tokens + the accumulated FLAP rewards directly in your wallet.
The public launch of the Farm and IgniSwap DEX will be announced soon!