School of PembRock
  • 🔥Welcome to PembRock Finance
  • ‼️Risks
    • Risks for Farmers
    • Risks for Lenders
  • What is Leveraged Yield Farming?
  • About PembRock
    • How PembRock Finance Works
    • Ref Finance integration
    • User Story: Lender
    • User Story: Farmer
    • Audits
    • Borrowing Interest Rate on PembRock
    • Parameters & Key Figures
  • Roadmap
  • 💰Tokenomics
  • ❔FAQ
  • Quick Links
  • Education
    • How-To Guides
      • How to create a NEAR wallet
      • Lending: Step-by-step guide
      • Farming: Step-by-step guide
      • How to buy PEM
      • How to Stake PEM & Join DAO
      • How to claim $PEM token on Meta Yield
    • NEAR Protocol Introduction
    • General DeFi Investing
      • What Is DeFi?
      • CEX vs. DEX
      • How to Become a Liquidity Provider (LP)
      • Understanding Impermanent Loss
      • Token Correlation
      • The Importance of Diversification
    • Leveraged Yield Farming Education
      • Farming roles explained
      • Providing Liquidity to DEXes — Key Benefits
      • Undercollateralization: The Key to Leveraging
      • Yield Farming Myths Busted!
      • Key Leveraged Farming Strategies
      • How to Avoid Getting Rekt in Leveraged Yield Farming
      • Calculating Leveraged Yield Farming Returns
      • The Power of Hedged Positions
      • The Big Short—PembRock Style
      • Yield Farming with Leverage: How to Maximize Returns
      • Useful Links & Tools
    • Yield Farming Glossary
  • Legal notes
    • PembRock Finance Cookies Policy
  • pembrock.finance
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On this page
  • What is a DEX?
  • Why provide liquidity to DEXes?
  • How to provide liquidity & farm
  • Why farm with leverage through PembRock?
  • PEM Farms on Ref Finance

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  1. Education
  2. Leveraged Yield Farming Education

Providing Liquidity to DEXes — Key Benefits

Before jumping into any farming protocol, it’s important to understand where your money is going and how your rewards are generated. By reading this, you will understand what farming is and where your returns come from.

What is a DEX?

A DEX (decentralized exchange) is a platform that enables straight P2P transactions using virtual currency. Unlike the traditional order book method and third-party control that is the feature of centralized exchanges, DEXes give you full control over your own data, and allow you to buy tokens without having to match with a seller, and vice versa. The reason that you can buy or sell without a counterparty is due to the fact that all trades are regulated through smart contracts, with funds taken or added to liquidity pools. DEXes require large reserves of funds to make sure that enough liquidity is required to facilitate trades, meaning users are incentivized to lend out tokens that can be used by the protocol, receiving a proportion of the fees and other rewards — this is what’s known as yield farming.

Why provide liquidity to DEXes?

With many competing DeFi platforms on the market, DEXes need to provide generous conditions to entice participants to farm with them. Simply a share in the fees is not usually enough. Farmers are often provided with higher than usual APY, governance tokens, or extra rewards. Getting a handsome return for simply locking up your token can allow you to quickly grow your investment, but of course, is subject to price dips and impermanent loss as risk factors.

How to provide liquidity & farm

While there are small differences depending on the DEX you are providing liquidity to, the following steps generally apply.

  1. Select the DEX

  2. Select the pair

  3. Make sure an equal amount of both tokens is in your wallet

  4. Provide liquidity to the liquidity pool

  5. Get LP tokens — representing your 50:50 token share in the pool

  6. Stake your tokens for farming rewards

Why farm with leverage through PembRock?

Farming with leverage gives you the option to capitalize on the great farming rewards offered by DEXes. Through an undercollateralized loan, you can farm 3x the amount of crypto, generating larger rewards than you would be otherwise able to do. Sound complicated? We make it simple, with:

  • An easy-to-use interface

  • Automated farming

  • Auto-reinvestment

PembRock counters the clunky and hard to use DeFi products that discourage the sector from being utilized by the wider community. In addition, we work on NEAR Protocol, a blockchain that is fast, inexpensive, scalable, and secure.

PEM Farms on Ref Finance

PembRock sits at the center of NEAR’s rapidly growing ecosystem, allowing us to capitalize on integrations with the freshest and most innovative projects. At launch we have already partnered with Ref Finance, meaning PEM token holders can already take advantage of rewards offered by this DEX

If you are PEM holder and want to start with DEX farms today, there are a growing number of options available to you.

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Last updated 2 years ago

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Ref.Finance ()

See how to take advantage of the PEM farms available on by checking out our .

Also, PembRock recently announced its own , where you can get a 20% bonus on liquidity provided to participating DEXes.

https://app.ref.finance/farms
Ref.Finance
step-by-step guide
LP incentivization program
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