Pseudonymous DeFi researcher Hansolar analyzed monstrous amount of data from DefiLlama tracker and picked most impressive APYs for safe yield farming
The cryptocurrency expert, who goes by @hansolar21 on Twitter, analyzed data regarding the safety, profitability and sustainability of 5,510 yielding farm equipment (liquidity pools) across all major smart contract platforms. Here are his top picks.
Seeking best and safest yield on DefiLlama
According to a thread shared by @hansolar21 on Twitter yesterday, on Oct. 28, 2022, through ML instruments and big data analytics tools, he scanned thousands of protocols designed for “yield farming” (getting rewards for providing cryptocurrency liquidity to on-chain exchange systems). Data was provided through the API of the top-tier DeFi tracker DefiLlama.
They decided to experiment with a hypothetical $100,000 deposit: as such, only durable pools with more than $400,000 in Total Value Locked (TVL) were included in the analysis.
Out of the initial pool of 5,510 protocols, only 327 were “confident” and offering annualized yields of over 5% (which can be easily found in risk-free centralized and decentralized passive income machines). Only 130 protocols were of an appropriate size for injecting $100,000 in equivalent right now.
@hansolar21 Most of the interesting opportunities run on top of the Ethereum (ETH) blockchain: Badger DAO, Sushi Swap, Angle, Goldfinch Protocol; While on Ethereum’s L2, the optimism option with the LYRA token also found it impressive.
Meanwhile, the on-chain derivatives platform GMX was highlighted by the analyst as the top pick: both Arbitrum- and Avalanche-based pools of GMX are offering 15-20% on the GLP token.
Sad but true: no lucrative produce farming outside the top league
On Polygon, the experienced DeFi Kyber network offers the best rates for safe yield farming, while multi-protocol platform Tetu offers 20% yields on the BTC-USDC pool. Friktion Labs, Frakt and Credix Finance were the leaders in the Solana segment.
Also, Avalanche’s oldest DeFi Trader Joe looks good to the expert for AVAX liquidity. Other opportunities looked either too risky or too unsustainable to him:
Everything else is either transient, unstable, too short, too small, imminently rugged, not really yielding
He added that other overhyped smart contract platforms — including the likes of BSC, Polkadot, Fantom, Cronos, Karura, Kusama, Moonriver and Ontology — look disappointing when it comes to yield farming alternatives.
