# Yield Farming

Last updated

Last updated

Yield Farms allow users to earn OBOS while supporting Oboswap by staking LP Tokens.

Check out our How to Use Farms guide to get started with farming.

Yield farming can give better rewards than Syrup Pools, but it comes with a risk of **Impermanent Loss**. It’s not as scary as it sounds, but it is worth learning about the concept before you get started.

Check out this great article about Impermanent Loss from Binance Academy to learn more.

Reward calculations

Yield Farm APR calculations include both:

**LP rewards APR**earned through providing liquidity and;**Farm base rewards APR**earned staking LP Tokens in the Farm.

Why? Because when you stake your LP tokens in a farm to earn OBOS, you're still providing liquidity to the liquidity pool, so you earn LP rewards as well!

So how do we calculate those figures?

Calculating Farm Base Reward APR

The** Farm Base APR** is calculated according to the farm multiplier and the total amount of liquidity in the farm -- this is the amount of OBOS distributed to the farm.

Calculating LP Reward APR

On top of that, farmers receive** LP rewards** for providing liquidity. Here's an example of calculating **LP rewards**:

In the WBNB/BUSD pair above, we see these values:

**Liquidity:** $387.42M
**Volume 24H:** $96.97M
**Volume 7D:** 709.73M

Calculate yearly fees

Use the 24H volume to calculate the

**fee share**of liquidity providers in the pool (based on the 0.17% trading fee structure): $96,970,000*0.17/100 =**$164,849**Next, use that

**fee share**to estimate the projected**yearly fees**earned by the pool (based on the current 24h volume): $164,849*365 =**$60,169,885**

We can now use the yearly fees to calculate the

**LP rewards APR:**That's**yearly fees**divided by**liquidity:**($60,169,885/$387,420,000)*100 =**15.53% LP reward APR**