What Is ‘Yield Farming’ and How Does It Differ from Staking?

Yield farming is an active DeFi strategy where users seek to maximize returns by lending, borrowing, or providing liquidity across various protocols, often involving complex and rapidly changing strategies. Staking is a simpler, more passive process of locking tokens directly into a network's consensus mechanism for security and block rewards.

Yield farming typically carries a higher risk profile than staking.