Profiting Strategy and Tutorial: Maximize Your Farming Yields with SheepDex
Whether you are a new yield farmer or a professional one, you can now earn more profits on SheepDex, thanks to the concentrated liquidity and two generous incentives for LPs: yield farming and transaction fee refunds.
On SheepDex, you can concentrate all your funds in a custom price range where you think most transactions will occur, rather than spreading all your liquidity in a range from 0 to infinity, as on other DEXs. As a result, you will have the opportunity to maximize your profits and improve your capital efficiency.
You can get passive from yield farming by providing liquidity; you can also get transaction fee refunds as LP rewards when trades occur within that range.
Gain more benefits with a single action.
This is suitable for stablecoin pair enthusiasts as price fluctuations are usually very small. Now with SheepDex, you can concentrate all liquidity in a very narrow range. In the stablecoin pair USDT/BUSD, for example, most liquidity is concentrated in price range of 0.99 to 1.001. This way, you will earn more fees since most transactions also occur in this very concentrated range.
The concept of other trading pairs is almost the same. You can set your price range relatively small and can get more fees if the transaction prices fall within your range. You can also actively change your position at any time based on market conditions for greater profit. Because of the low gas fee and fast speed of BSC, It’s more cost-effective to do that than on ETH.
Quick overview of incentive rules
- Yield farming incentive is only available for pools with 0.2% fee;
- Transaction fee refunds are available for all pools with different fees, as long as those transactions occur within your range;
- Supported pools: BNB-BUSD, BNB-BTC, BNB-ETH, BUSD-BTC, BUSD-ETH, ETH-BTC, BUSD-USDC, BUSD-USDT, BNB-SPC.
It is time to yield farm and earn SheepDex.
- Navigate to SheepDex, click the Pools button, Click +New Position button on the top right to enter the Add Liquidity page.
2. Select the trading pair that you want to provide liquidity. Let’s say I wanted to participate in the USDT — BUSD pool.
3. Choose a fee tier from 0.1%, 0.2%, and 0.5%. As yield farming incentive is available for the pair with 0.2% fee tier, so we usually would choose the fee of 0.2%.
Notes: Depending on different trading strategies, you may also try adding liquidity for other trading pairs with different fee tiers. Do your own research and select a fee based on your desired strategy.
4. Choose a price range. Set the range to where you believe most of the transactions will occur to maximize the transaction fee refund you will get.
You can also add liquidity to the price range from 0 to infinity as on other DEXs by clicking Full Range button.
Sometimes, adding liquidity may fail due to high price volatility. To make sure that you can complete this, you can set the slippage a little bit higher. But be aware that high slippage could also lead to capital loss.
5. Deposit the amount you want to allocate. Enter the amount of one token and the amount of the other token in the Deposit Amounts section below.
SheepDex’s v3 AMM has one major difference from other DEXs and some LPs may find it a bit confusing. The ratio of the market value ratio of the two tokens provided by LP is no longer a 50/50 ratio. Because this will be determined by a function of three key parameters: the Min Price, the Max Price and the Spot Price.
Once these 3 parameters are confirmed, the ratio of two tokens is fixed. Since Spot Price is completely determined by the market and not adjustable, so the only way for LPs to change the amount of the two tokens provided is to adjust the price range.
6. Confirm and Approve. You are now an official SheepDex LP and are starting to earn a fee refund.
7. Visit the Yield Farming page and select the pools that you already provided liquidity.
8. Stake your position.
Congrats! Now you can get the income from both yield farming and transaction fee refund!
SheepDex Overview
SheepDex is the first DEX offering concentrated liquidity, which integrates spot and derivative trading in the Binance Smart Chain (BSC) ecosystem. It helps liquidity providers (LPs) and traders to maximize capital efficiency and earnings by introducing several innovative features that are not yet available on other DEXs in the BSC ecosystem, such as concentrated liquidity, multiple tiers of fees, range orders, and triple incentives.
Join Us
Website: https://SheepDex .org
Twitter: https://twitter.com/SheepDex
Medium: https://medium.com/SheepDex
Telegram: https://t.me/SheepDex
Discord: https://discord.gg/HPcTX23vPT
