The Essential Guide to Farming, Harvesting and Mining Cryptocurrencies

Paul Richardson

11 min readJan 18, 2022

Two ways to invest and grow your cryptocurrency holdings

[Article updated on 31st March 2022]

In this article, I will tell you:

What a Decentralised Exchange (DEX) is
What mining is
What farming is
What harvesting is
Overview of the Mad Meerkats Finance DEX
How to increase earnings with a Meerkat NFT
How to farm or mine on MM Finance
What other investment options are available

What is a Decentralised Exchange (DEX)?

An exchange is a service that allows people to trade from one asset to another (e.g. BTC to ETH).

Exchanges can be centralised or decentralised:

Centralised exchanges: Owned and managed by a single company/organisation
Decentralised exchanges: Available on public decentralised blockchain networks, open for anyone to use, rather than going through ‘middlemen’ like banks or brokerages

Some Pros of Decentralised Exchanges:

They are more secure (as you have full control of your assets i.e. the private keys to your wallet)
Permissionless, so anyone can run a ‘compute node’ to help run the overall system and get rewarded for doing so
Far less chance of manipulation, theft, etc.
Harder to close or diminish services
They utilise blockchains, where a full record of transactions is available to view — these records cannot be altered or manipulated

Some Cons of Decentralised Exchanges:

Not as easy for people to use as ‘centralised services’ (but not that difficult either)
Changes to the environment must be agreed by consensus, so may not always be approved

What is Mining?

Mining is where you stake a cryptocurrency with a DEX and receive a reward. Most DEX’s have no requirements for minimum amounts or staking durations.

The coin that is given as a reward is usually the same as the one that you have staked, but it can be different.

If the reward is the same as the coin you are mining, it is beneficial to re-invest it regularly. This increases your mining stake (capital), which results in greater reward as you continue to mine — this is compound interest.

Some DEX’s allow the process of re-investing rewards to be performed manually or automatically.

Advantages of Mining:

Easy to set up
No minimum stake
Can withdraw at any time
Auto re-investment is often available, allowing a ‘set it and forget it’ approach
Only 1 coin to consider
You can gain from the value of the coins increasing in value, as well as a return from staking

Disadvantages of Mining:

The value of the coin can decrease
The APR value for mining can (and often will) fluctuate a lot over time, so cannot be relied upon for long-term estimates

What is Farming?

Exchanges need enough liquidity (amounts of each cryptocurrency to be traded) to allow trade.

Farming is where you hold 2 different coins in a ‘liquidity pair’, enabling people to trade between them. When people use your coins, you get a percentage of the trade as reward.

You may be familiar with trading pairs such as these:

BTC <> ETH
BTC <> ADA
BTC <> USDC
ETH <> ADA
ETH <> USDC
There are thousands more…

If you were to join the liquidity pool for BTC <> ETH you would likely get a low level of commission because they are both commonly traded coins so the pool will probably already be very large.

To receive a higher level of commission you could enter a smaller trading pool with new or lesser-traded coins:

If I created a new coin called ‘TEC’, it would need new trading pairs so you can purchase it, so:

TEC <> BTC
TEC <> ETH
TEC <> ADA
etc.

If TEC <> SOL wasn’t available as a trading pair, but you only had SOL; to buy TEC, you would have to buy another coin (e.g. BTC) and use that to buy TEC e.g.:

Use SOL to buy BTC
Use BTC to buy TEC

Additional steps result in more fees and complexity.

So in this instance, if you were to set up a liquidity pool for TEC <> SOL, people would start using this pool and you would gain commission.

Joining liquidity pools with a high commission rate generally means higher risk as the pool might not be used much (providing little return) or one of the 2 coins in the trading pair could quickly decrease in value. The advantage is that one of the coins could quickly increase in value.

Setting up a Farm

When setting up a farm on a DEX, you will be able to choose from a number of trading pairs.

When choosing a farm (trading pair):

Understand both coins in the trading pair you choose
Be happy with the cryptocurrency that is provided as a reward (it may or may not be the same as the coins in the trading pair)
Be happy with the APR value (this is only an estimate, it will change over time)
Understand and be happy with the risk-reward

Once you have decided on a farm, you need to:

Have equal amounts (in value) of the two coins
Trade the two coins for the Liquidity Provider (LP) version of the coin
Stake the LP version of the coin within the farm

Advantages of Farming:

One or both of the coins can increase in value
Being invested in one or more farms can help diversify your portfolio
You can gain from the value of the coins increasing in value, as well as commission from providing liquidity

Disadvantages of Farming:

One or both of the coins can decrease in value
The APR value for farming can (and often will) fluctuate a lot over time, so cannot be relied upon for long-term estimates

What is Harvesting?

Harvesting is the term used to describe the collection of rewards from Farming or Mining.

For both Farming or Mining, harvesting can be performed manually or automatically, depending on the options within the DEX.

Automated Harvesting

If reinvesting automatically, the process is simple — the profits will be re-invested back into the Farm or Mine on a regular basis (e.g. daily).

Manual Harvesting

If harvesting a Farm or Mine manually, if the output is the same as the coins being Farmed/Mined; you can re-invest the output back into the Farm or Mine.

If the output is different from the source, you could:

Stake the cryptocurrency in another Farm or Mine
Export the cryptocurrency to another exchange (to be staked)
Convert the output to another cryptocurrency

Overview of the Mad Meerkats Finance DEX

I use the Mad Meerkats Finance (MMF) DEX for mining and farming. I like it because more than other DEX’s I’ve used, they are focused on automating the management of investments and they incentivise people to stay invested on a long-term basis.

MMF’s Primary Goals

Provide users with a safe, fast, easy and low-cost way to exchange cryptocurrencies
Provide investors with a safe, easy and low-cost way to earn profit by staking cryptocurrency

As an investor, I like how they automate the re-investing of profits (i.e. compounding interest). They also incentivise investors to hold on a long-term basis.

Runs on the Cronos Blockchain

MMF resides on the Cronos Blockchain, owned by Crypto.com. This means:

The fees for moving and transacting are very low
The DEX application can be accessed from the Crypto.com DeFi wallet, or from a web browser
The blockchain technology it resides on is very secure, trustworthy, open sourced and audited

MMF vs MMO

The MMF website is split into two sections:

Mad Meerkat Finance (MMF) has Farms and Mines that need to be harvested manually
Mad Meerkat Optimizer (MMO) has vaults (essentially Farms and Mines) that automatically manage the compounding of interest

MMO is described on their FAQ page as:

Mad Meerkat Optimizer is a new and rapidly growing DeFi yield aggregator that is used for MM Finance. Mad Meerkat Optimizer empowers farmers to leverage their yield-seeking tendencies to optimize yield compounding strategy on Cronos. We are providing strategies for the various needs of farmers from the highest yield seekers to the risk reward optimizing smart investors.

Increase Earnings with Mad Meerkat NFTs

They have an innovative feature where each Mad Meerkat NFT you have staked will provide extra earnings on your stake.

You can add them in MMF, to earn 1% per day for each Mad Meerkat NFT you have staked (up to 3%).

Example: If you are earning 1000 MMF a day (note this is earnings not base), then you will get an additional 3% on top of that, getting you 1030 MMF a day.

Or in MMO vaults, you can earn an additional 3% MMO per Mad Meerkat NFT (up to 15%) when you harvest. Note that the MMO vaults are a ‘set it and forget it’ solution — they auto-compound, so the longer you leave them without harvesting, the greater your reward.

How to Farm or Mine on MM Finance

Step 1: Identify which farm or mine you want to participate in

From the Crypto.org DeFi Wallet app, go to:

In the Cronos DApps menu, select ‘MM Finance’

If using MM Finance:

Select ‘Farms’ or ‘Pools’
Select the farms or mines to see their details

If using MMO:

Select: ‘Vault’
Select: Connect Wallet’
Select: ‘Crypto.com DeFi Wallet
Select the farms or mines to see their details

Step 2: Fund your MM Finance wallet

From your Crypto.com app:

Select: Accounts
Select: Cronos
Select: Transfer
Select: Withdraw
Select: Crypto.com DeFi Wallet
Select ‘Crypto.org’ and enter an amount of CRO (leave at least 0.001 CRO in your account to pay the sending fee)
Select: Send (completing the 2 Factor Authentication process)

From the Crypto.org DeFi Wallet app:

Select: Wallet
Pull down on the screen to refresh it, to ensure that your CRO has arrived in your wallet
Scroll down and select ‘Bridge through chains. Migrate assets to Cronos’
From = Crypto.org, To = Cronos Beta
CRO — enter the amount of CRO you want to bridge (usually this is ‘MAX’)
Select: ‘Transfer the ‘xxxx’ CRO
Select: ‘Confirm to Transfer’
Close the ‘Request Submitted’ screen
In the top-right of the ‘Cronos Bridge’ screen, select the ‘history’ icon
Look at the most recent transaction at the top. You will see if it is still in progress
Once it is no longer in progress, press back twice, to go to the home screen. Then go to the DApps screen

Step 3: Purchase the required token

In the Cronos DApps menu, select ‘MM Finance’
Select ‘Trade | Exchange’
CRO = select MAX then subtract 20 CRO (we will reserve these for fees)
Set To = The token you need (when farming 2 tokens, I trade all my CRO to one token, then half of that token for the second token)
Select ‘Swap’ then ‘Confirm Swap’ (if staking 1 token, proceed to step 3)
If farming, go to ‘Trade | Liquidity | Add Liquidity’, enter the 2 tokens you will be farming, select ‘MAX’ on the 2nd one, then select ‘Supply’ and ‘Confirm Supply’

Step 4: Stake

If using MM Finance:

Select ‘Farms’ or ‘Pools’
Select the farm or mine you want to use
Select ‘Max’, then ‘Stake’

If using MMO:

Select: ‘Vault’
Select: Connect Wallet’
Select: ‘Crypto.com DeFi Wallet
Select the farm or mine you want to use
Select ‘Max’, then ‘Stake’

What other Investment Options are Available?

HODL in a Wallet

For the lowest risk but lowest reward, you can ‘HODL’ (hold) your cryptocurrency in a wallet.

On my website SelfCrypto.com, I describe what cryptocurrency wallets are, the different types available and when to use them.

For holding on a long-term basis, I recommend using a hardware wallet (I use and recommend the Ledger Nano X).

Some cryptocurrencies support ‘proof of stake’ within the wallet, which allow you to earn interest while your money is sitting there. Ledger hardware wallets support secure staking of some cryptocurrencies.

Staking with a Central Provider or Exchange

In apps such as Binance or Crypto.com’s App or Exchange, you can stake a wide variety of cryptocurrencies at a good APR. Check out the APR and stake durations for each service.

The disadvantage of centralised services is that you do not own the private keys, so there is a risk that you could lose some or all of your cryptocurrency. Because of this, you should research the services you use to ensure they have good security standards. I like Crypto.com because they have some of the best (if not the best) security certifications and audited systems of any cryptocurrency company.

Staking in DeFi

In my article ‘The Essential Guide to Maximising CRO Investment with Crypto.org DeFi’ I explain how you can earn about 13% APR (higher if you re-invest the interest daily/weekly) with CRO, using a decentralised service and a Ledger Nano X hardware wallet — this is a good return and is safe.

Staking for a Cryptocurrency Related Pre-Paid Debit Card

A number of debit cards are available. Some hold fiat and some hold cryptocurrencies — they usually provide cashback as a cryptocurrency, as well as other rewards.

I use the Pre-Paid Visa Debit card from Crypto.com as my primary card for spending as this provides the best fit for my requirements. The higher tiers provide 10–12% APR on the card stake, as well as reimbursement for services such as Spotify, Netflix and Amazon. You can use the spreadsheet within my card article to estimate what each card will provide, based on your average spend. The only disadvantage is that it’s a centralised service, so you don’t own the private key, so your money is at risk.

Summary

Personally, most of my cryptocurrency is CRO, staked in a Crypto.com Frosted Rose Gold debit card (€35k/£30k/$40k) and Crypto.com DeFi. I have high conviction in the CRO coin and the Crypto.com ecosystem. Storing them with these methods is only tied to the value of the CRO coin.

To diversify my portfolio/risk and potentially establish some exceptionally high gains, I have some money in the Mad Meerkat Finance DEX. I like their MMO auto-compounding system, I add to my stake there every month.

Want More?

Recommended Services

Sign up to Curve and get £5
Sign up to Crypto.com with referral code qu80wtyk0i This can be used within 5 days from having your account KYC approved. Get $25 when you stake for a card
Sign up to the Crypto.com Exchange with referral code qu80wtyk0i, you will get $10 if you stake at least 1,000 CRO and $50 if you stake at least 5,000 CRO

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