The industry of Cryptocurrency is continuously changing and evolving. New methods, projects, and coins to invest in and exchange digital currencies come up daily. Swap farming, launched by Binance (pretty much like staking), is one such famous product.
Swap Farming is the latest product launched on Binance Earn. You can get additional BNB rewards whenever you swap particular token pairs on it.
With the introduction of decentralized exchanges in 2020, swap farming has become realistic.
In other words, users lend their crypto to exchange in pools and farms to offer Liquidity for trading in return for incentives.
The fame of swap farming is developing when the decentralized finance field boosts, and people can get cryptocurrency rewards via farming, which is another excellent option for mining.
Understand the difference between Staking and Farming
In the market of Cryptocurrency, there are various tactics to produce sizable passive money.
Staking and swap farming are perfect ways to generate passive income as a cryptocurrency owner, and they have many things in common.
The main difference is that yield farming requires users to deposit their crypto money on sites and Defi projects.
Staking is when the investors of Cryptocurrency place their funds for a fixed amount into the blockchain for validating blocks and transactions.
The procedure is the same as fixed earning assets such as bonds – the holder stakes the crypto coins and receives a yearly income in return.
Assessing the best investment return between staking and Swap farming may make you pick swap farming. However, the debate should go further.
Swap farming is challenging for new cryptocurrency investors to comprehend, and it may take further research and time. Staking crypto gives reduced advantages; however, it doesn’t impose continuous attention on the investors. Ultimately, you can hold certain money for more extended periods.
How to begin Swap Farming
Swap farmers help the system because their platform gives them an inducement, similar to other systems. Usually, farms with the best returns are safest and generate the most considerable profits.
Each blockchain has different produce farms; each has its own rules. Some users prefer buying the capital required to become a swap farmer, whereas others are worried about identifying the best yield farm for the already possessed assets.
There is a Binance Smart Chain system, which is considered the most famous option for various reasons.
Rather than trading straight with a third person, automated market makers enable you to exchange your crypto coins from a liquidity pool. The concerned authority pools together all the tokens and decides each token’s rate through its ratio.
For instance, one investor could add an equal portion of BUSD and BNB tokens to the BUSD – BNB pool.
Then, someone else could use these tokens for making a fee-based exchange between BUSD and BNB.
Swap Farming gives all the advantages that Binance is recognized. You will not lose money when you use swap farming; thus, you may confidently use it.
Any swap or trade carries the danger of slippage, which causes a cost that varies from your expectation. But, because of the industry-leading Liquidity of Binance, the possibility has been decreased through Swap Farming.
Swap farming provides more than 100 trading pairs; each comes with higher Liquidity.
Below are the steps to get started through the Binance portal.
- Register or sign up for your Binance account. Then go to the menu section, hover over the Trade option, and click on swap farming. That will redirect you to their swap farming page.
- Choose the token pair that you would want to exchange. After that, you can select from different cryptocurrencies and determine whether you wish to swap or add the crypto coins into the liquidity pool.
- The next step is to type the number you want to trade and cross-check your transaction details. At last, charge and slippage are automatically analyzed.
- Click on the Liquidity or Swap to continue. And then, to finish the transaction, you can again click on the Swap. Now start the procedure of claiming your reward.
Steps to claim Swap Rewards?
Only limited token pairs are entitled to Swap Rewards on Swap Farming.
1. Click on the “view all” option to see all liquid swap pairs entitled to an equal 50% fee rebate in Binance. Remember that the Swap Rewards you get will be estimated according to the swap prices of your order. They will swap the transaction fee rebate to your Binance and credit it to your spot wallet. Ensure that you choose tokens entitled to Swap Rewards before validating the Swap. Otherwise, you cannot obtain the BNB rebates.
2. Tick the checkbox beside “filter-all-tokens with rewards,” You will only receive tokens entitled to Swap Rewards. Select the desired tokens and then type the amount.
3. Now verify the amount and token.
4. The system will show the swap rates and automatically assess the fee, slippage, and approximate Swap Rewards in BNB. Click on the Swap option to go ahead.
- Price: the approximate swap price. Remember that this isn’t the ultimate swap price. You will check the maximum price when you confirm your order.
- Fee: it is the transaction fee taken by liquidity providers.
- Slippage: the approximate ratio that the final executed swap price strays from the current rate because of the trading money.
- Est. Fee Return: The approximate sum of Swap Rewards you will obtain in BNB.
5. You will receive a confirmation post the completion of Swap. You can click on “view swap history” to check your order, or you can also click on the option “back-to-swap” for placing another order.
The pairs of Cryptocurrencies that are entitled to Liquidity
Presently, the below pairs are accessible for Swap Farming on Binance
You will receive the rewards in your BNB two weeks post the conclusion of the competition, based on the USDT/BNB exchange rate during distribution. Whenever you compare staking and swap farming, remember that swap farming is still the latest approach, and the single way to understand how to reap the perks of swap farming is via experience.