For cryptocurrency holders, one of the ways to earn passive income on your idle cryptocurrency is to supply them into liquidity pools and earn yields from these liquidity pools.

Here’s a simple illustration from Uniswap on how liquidity pool works:

As a liquidity pool provider, you will earn interest originating from the transaction fee generated whenever a trader or borrower executes a cryptocurrency trade.

For Harmony One, here are a list of liquidity pool provider or yield farms where you can supply your cryptocurrency into in order to generate a return on your digital asset.

As there are new yield farms being created everyday, please do your own research on the team’s background before committing large amount of cryptocurrency to a new farm.

As a rule of thumb, signs of a good liquidity pool include:

1. The longer the liquidity pool is around, the safer it is.
2. The more total value locked in the farm, the safer it is.
3. The more cryptocurrency pair available for staking, the safer it is.
4. High APYs (4 – 7 digit APYs) generally means the liquidity pool is relative new and less stakers to split the pool rewards.
5. The more users staking their cryptocurrency (total value locked), the safer it is.
6. The more protocols built on top of the liquidity pool, the safer it is.

Here’s a look at Mochi, one of the more popular liquidity pool provider for the Harmony One Network:

Also Read: The Full List Of Yield Farms On The Polygon Network