DeFi Yield

DeFi yield products use lending, collateral, and incentive mechanics to create returns and risks.

APY

APY estimates annualized return after compounding, though crypto yields can change quickly.

Yield farming is the practice of allocating crypto assets to earn protocol incentives or fees.

A lending pool lets users supply assets that other users can borrow against collateral.

Collateral is an asset pledged to secure a loan or leveraged position.