Directional Yiled Farming

Delta Farming takes one token (BUSD) and swaps a portion of it into the second token required for the yield farm. The protocol automatically deposits the two tokens into a liquidity pool, then stakes the LP Token into the Yield Farm. The protocol then periodically harvests rewards from the yield farm, swaps them back into BUSD and makes the BUSD (Unclaimed Interest) available to be claimed by the End User. The position is exposed to fluctuating market conditions and will experience impermanent loss as discussed above in previous topics (there are no IL protections in this protocol so IL can be greater but so can the rewards/APR. Our IL code can however be subsequently built into this protocol).

The benefit of Directional Farming is that you can generally earn a higher APR, plus capital gains during rising markets. The downside is that you have full exposure to any falls in prices of the tokens you are yield farming. Many yield farmers choose directional yield farming due to the (relatively) less complexity as compared to market neutral yield farming. And many directional yield farmers are simply yield farming using digital assets they would otherwise have sitting in their wallet, or earning interest in a single asset lending platform (eg AAVE, Compound).