Yield farming is basically based on the principle of opportunity costs, which can be illustrated relatively well using the example of agriculture. Over the course of a year, a farmer cultivates various plants on his field, but the harvest, which is crucial for success, is only done after several months of hard work. As soon as the harvest begins, one speaks of yields. The yield is set in relation to the cultivated good. The higher the yield with a fixed input, the higher the return. In English the yield is also called yield.
This should make it clear what is behind “yield farming”. In the crypto-sector, the farmer could be equated with investors who invest their coins on different platforms in order to achieve the maximum yield.
Yield farming is therefore an investment strategy for the DeFi market that allows people to earn a fixed or variable interest rate. Yield farmers are therefore people who measure their personal return in terms of the interest earned.