I am too lazy to explain so I shall just drop a video here. One video says it all.
Liquidity mining – the process of distribution of tokens to users of the protocol. It’s additional incentive for yield farmers (these tokens can be staked for additional reward).
Leverage – Farmers can deposit their coins as collateral to one of the lending protocols to borrow other coins, they can repeat this procedures.
Risks – liquidation risk (from leveraging), smart contract risk, defi specific risks.
Crop rotation can help farmers keep up with changes in yields.
People input, people borrow, borrowers input again to chase high yields… this goes on until a bubble burst?
Some starter advice:
1) Learn to differentiate between Cefi and Defi
2) Read the reviews and find out which (platforms) suit