Yield and Farming

Yield in DeFi is not magic income. It comes from identifiable cash flows, token incentives, or market structure, and each source has a different level of durability.

When someone advertises a high APY, the first thing to ask is not how large it is. Ask where it comes from and what happens when incentives fade or demand cools down.

Fee yield tends to be the easiest to justify because it reflects actual activity. Lending interest can also be real, but it depends on sustained borrowing demand and healthy collateral management.

Emissions are different. They can bootstrap liquidity and attract users, but they are often temporary and can disappear faster than a dashboard suggests. Good yield analysis separates recurring revenue from incentive spending.