Yield Farming [Crypto-currency]

Assalamaleykoum,

I am new here, what is your opinion on ''Yield farming" in the crypto scene.
If I am correct this is new form of staking where an algorythm helps finding the best opportunities in real time.
"It’s a new way to earn rewards with cryptocurrency holdings using permissionless liquidity protocols. It allows anyone to earn passive income using the decentralized ecosystem of “money legos” built on Ethereum"

Thank you

Wasalam

May Allah bless you.
Yield farming is a form of lending and the reward is equivalent to interest. Given the nature of some cryptoassets, I do not think it is permissible to engage in such activity.
@Mufti_Faraz_Adam might hold a different opinion.

And Allah knows best!

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thank you for your reply
peace upon you

@Mufti_Billal

piggy backing off this topic, does this apply to all forms of yield farming?

many decentralized exchange projects/protocols allow people to deposit their tokens to the exchange pool, basically acting as market makers/liquidity providers. In return you receive trading fees, as well as the governance token of the exchange as an incentive for keeping your liquidity in the pool. Is this a form of lending? and would the rewards be considered a form of interest?

Apologies if this is exactly what you meant in your first response.

Assalaamu alaykum,

I also agree that Yield Farming from what I have seen so far in the industry is interest based.

whenenever your crypto holdings are temporarily at the disposal of some startup’s application or someone else whilst guaranteed for you and earns its owner more crypto currency, without any equity stake or trade, it falls under interest and a form of lending crypto.

Allah knows best

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thank you
Peace upon you

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