# Yield Farming

<figure><img src="/files/frywf28TX4lYasz1oKfi" alt=""><figcaption></figcaption></figure>

Yield Farming enables users to earn U2U tokens while supporting GroFi Dex by staking LP Tokens.

Explore our [How to Use Farms](/features/yield-farming/how-to-use-farms.md) guide to begin your journey into farming.

## Reward calculations <a href="#reward-calculations" id="reward-calculations"></a>

Yield Farm APR calculations include both:

* **LP rewards APR** is earned by providing liquidity.
* **Farm base rewards APR** is earned by staking LP Tokens in the Farm.

Farm total APR = Farm base APR + LP rewads APR

Why? Because when you stake your LP tokens in a farm to earn U2U, you're essentially providing liquidity to the liquidity pool, thus earning LP rewards alongside!

## Calculating Farm Base Reward APR <a href="#calculating-farm-base-reward-apr" id="calculating-farm-base-reward-apr"></a>

**The Farm Base APR** is determined by the farm multiplier and the total liquidity in the farm, which represents the amount of U2U distributed to the farm.

## Calculating LP Reward APR <a href="#calculating-lp-reward-apr" id="calculating-lp-reward-apr"></a>

In addition, farmers receive **LP rewards** for providing liquidity. Here's an example of how **LP rewards** are calculated:

<figure><img src="/files/LddoMuttrQUavvYoo6mb" alt=""><figcaption></figcaption></figure>

In WBTC/USDT pair above, we see these values:

**Liquidity:** $3.43M&#x20;

**Volume 24H:** $11.38K&#x20;

**Volume 7D:** $53.85K

* Calculate yearly fees
  * Use the 24-hour volume to calculate the **fee share** of liquidity providers in the pool, based on the 0.05% trading fee structure: $11,380 \* 0.05 / 100 = $5.69
  * Next, use that **fee share** to estimate the projected **yearly fees** earned by the pool based on the current 24-hour volume: $5.69 \* 365 = $2076.85
* We can now use the yearly fees to calculate the **LP rewards APR**: That's **yearly fees** divided by **liquidity,** multiplied by 100: ($2076.85 / $3,430,000) \* 100 = 0.06% LP reward APR.


---

# Agent Instructions: Querying This Documentation

If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question.

Perform an HTTP GET request on the current page URL with the `ask` query parameter:

```
GET https://docs.grofidex.io/features/yield-farming.md?ask=<question>
```

The question should be specific, self-contained, and written in natural language.
The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.