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Survey shows 50% of DeFi Yield Farmers Can’t Read Smart Contracts

A recent survey exposed that the yield farming trend in crypto is limited to the marginal of users and may take on more threat than they understand.

A popular crypto tracking website, CoinGecko, has recently released the results of a new survey of cryptocurrency users on yield farming. It was found that out of 1,347 respondents surveyed last August, only 23% had participated in some form of yield farming in the past 30 days. Still, more than 80% were at minimum aware of the term.

Conducted through social media, the online survey responses also revealed that 40% of users who engaged in yield farming couldn’t assess the risk of smart contracts on their own; they are instead relying on auditors to identify threats from bugs or malicious actors who perpetrate the scams.

However, the audits are time consuming and pricey; thus, many projects forgo them altogether and increase the risk of DeFi farmers. CoinGecko says,

“All farmers should conduct their research before farming in any pools, as there is more copy-paste yield farming tokens that could potentially expose them to a greater risk such as code vulnerability or scams.”

This indicates that a few yield farmers are concerned with the substantial risk that faces their crypto deposits, and fewer still are even able to identify them initially appropriately.

Out of those who have tested the waters of yield farming for once, 60% said they were still farming, indicating that yield farming is developing at least some long-term staying power. Out of yield farmers, over two-thirds were aged 30 and 59, and more than 90% were male.

CoinGecko has noted that the survey results have confirmed that yield farming is mainly a place activity, which benefits those with a thorough understanding of both cryptocurrencies transacting and financial calculations and metrics.

For a few weeks, Ethereum transaction fees, or the cost users pay to send and receive tokens or interact with DeFi protocols on Ethereum blockchain, have been on raised levels. Occasionally, it costs the users more than $10 for a single transaction. It may be astonishing to discover that 52% of survey respondents said they had started to yield farming with less than $1,000 in the capital.

Many successful yield-farming strategies include consistent cycling through different DeFi protocols to pursue the highest revenues offered at a given time. That is why high gas fees can rapidly eat into profits and even starting capital if users didn’t plan accordingly. But, despite the operating costs, over 90% of CoinGecko’s yield farmer respondents said they had achieved 500% or higher returns from their activities.

CoinGecko found that while astronomical yields were likely to fade away from DeFi protocols, other forms of yield farming are likely here to stay, as different projects compete for the attention of crypto users and their capital reserves.

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