Author: Simon Cousaert, Jiahua Xu, T. Matsu
Title: SoK: Yield Aggregators in DeFi
In this Systematization of Knowledge (SoK), we study a general framework for yield farming strategies with empirical analysis.
First, we summarize the fundamentals of yield farming by focusing on the protocols and tokens used by aggregators. We then examine the sources of yield and translate those into three example yield farming strategies, followed by the simulations of yield farming performance, based on these strategies.
We further compare four major yield aggregators—Idle, Pickle, Harvest, and Yearn—in the ecosystem, along with brief introductions of others. We systematize their strategies and revenue models and conduct an empirical analysis with on-chain data from example vaults, to find a plausible connection between data anomalies and historical events. Finally, we discuss the benefits and risks of yield aggregators.
<aside> 🙇🏾♂️ Main idea summary and the underlying meaning of the article.
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The proposed framework for yield farming strategies involves:
(1) explaining the sources of yield and describing various yield farming primitives;
(2) creating a general workflow for yield farming strategies by studying protocols and tokens used by aggregators;
(3) providing examples of frequently used strategies and simulating yield farming performance;
(4) comparing major yield aggregators by summarizing their strategies and revenue models and evaluating on-chain data; and