The Unofficial Guide to Yield Farming on Raydium

The following post is by no means investment advice whatsoever and should only be treated as entertainment or for education purposes. Don’t Be Dumb™️.

A trader in the Market Mercenaries chat recently asked me how to go about farming on Raydium, the Automated Market Maker that runs on top of Solana. If you’re not familiar with Raydium it can be thought of as a Uniswap alternative but instead of running on Ethereum it runs on Solana and gains access to the entire Serum ecosystem of liquidity.

The major benefits of running anything, let alone an AMM on Solana, are that the transaction fees for executing any type of application logic (e.g., buying a token) are orders of magnitude lower than on Ethereum and transactions settle in a few seconds.

In short, the user experience is lightning-fast and costs next to nothing to use.

Why farm on Raydium?

In my opinion, Raydium offers a superior experience for the reasons mentioned prior, but as an investor, the momentum behind it is astounding. For example, the amount of liquidity locked up in pools is already in the hundreds of millions just a few weeks after launch.

But the main reason to farm on Raydium is the juicy yields. $RAY/$USDC, what we’ll be farming, is clocking in at 227%+ APR.

Finally, a unique characteristic to Raydium is the concept of “Fusion Pools” where you can actually earn a dual yield on the two tokens you are staking. Moreover, Fusion pools are enabling outsized yields on pairs like $COPE/USDC currently yielding 800%+ APR at the time of this writing.

How Do I Farm on Raydium?

Great so you’re convinced of how awesome it will be to farm on Raydium.

The following is a list of steps to follow to get going assuming you are starting from zero. We’ll be farming $RAY/$USDC.

  1. Create an FTX account and fund it (deposit) with your favorite cryptoasset(s). FTX is the only exchange, currently, that provides Solana conversion when you withdraw assets to your Solana wallet.

  2. Buy $SOL/USD on FTX. $SOL is required to transact on the Solana chain just like ETH is required to transact on the Ethereum chain.

  3. Buy $RAY/USD on FTX.

  4. Buy or convert some of your crypto to $USDC on FTX.

  5. Note: To farm $RAY/$USDC on Raydium you will need equal amounts of each token. For example, if you have $1,000 USD worth of crypto, buy $500 worth of $RAY and $500 of $USDC.

  6. Create a Solana wallet on Sollet.io. Sollet is to Solana what Metamask is to Ethereum.

  7. Withdraw your $SOL from your FTX wallet and deposit it into your $SOL wallet in Sollet. Your $SOL wallet address is a long string of characters highlighted in green (the example string in the following image is truncated).

  8. Withdraw your $RAY from FTX and deposit it into your $RAY wallet in Sollet.

  9. Withdraw your $USDC from FTX and deposit it into your $USDC wallet in Sollet.

  10. Now that you have the required assets to farm, let’s head over to raydium.io/liquidity/ and connect your wallet. This is a pop-up so turn off any pop-up blockers.

  11. Now that you’ve connected your wallet to Raydium, let’s create the liquidity provider tokens (LP) that you will stake to then farm. Select $RAY as your top token and $USDC as the bottom token. Select “Max” for $RAY and then click “Supply”. Be sure you have enough $USDC to match the $RAY tokens. If you don’t, select “Max” for $USDC.

  12. Confirm the transactions (another pop-up) and wait a few seconds, yes, literally a few seconds, and you should see that you have successfully created your LP tokens.

  13. Navigate to raydium.io/farms/ and select the $RAY/$USDC farm. Stake your LP tokens here by clicking “Stake LP”.

  14. Now, Select “Max” (your balance will not be 0.0000, it will be the number of LP tokens you just minted prior), click “Confirm” and then approve the Solana transactions (another pop-up). Within a few seconds, you should see your confirmation.

  15. Congratulations, you are now farming on Raydium. 🎉

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