Creating Farms
Ecosystem farms allow project teams to bootstrap liquidity by incentivizing liquidity providers with token rewards. Similar to creating a liquidity pool, any project team or user can set up a farm to reward LPs and attract liquidity to a specific pool on XenDEX.
Note: It is highly recommended to read this guide in full before creating a farm.
Important Considerations for Creating a Farm
AMM ID: Every farm must be linked to a liquidity pool via an AMM ID. A single AMM ID can support multiple farms if needed. Ensure the correct AMM ID is selected to guarantee that rewards are distributed to the intended pool.
Liquidity: It’s recommended to provide sufficient initial liquidity to the target pool before creating a farm. Low liquidity can lead to volatile prices, impacting users who add liquidity later and potentially causing impermanent loss.
Rewards and APR:
Target Total Value Locked (TVL): Decide how much liquidity you want in the pool and the acceptable level of price impact.
Reward Token Price: The value of the reward token directly affects APR. Estimating the token price over the farming period can help project potential returns.
APR Calculation: APR is calculated by dividing the dollar value of rewards by the dollar value of liquidity in the pool and annualizing the result.
Example: For $500 in daily rewards and $100,000 in liquidity, the APR is calculated as follows:
APR = ($500 / $100,000) × 365 = 182.5%
Thus, the annualized APR would be approximately 183%.
Important: Rewards allocated to farms are final and cannot be withdrawn once the farm is created. Adjustments to the rewards rate can only be made near the end of the farming period.
Steps to Create a Farm
1. Connect Wallet and Choose Target Pool
Go to the Liquidity page and click "Create". Make sure your wallet is connected.
Select “Creating a Farm”, then search for the target pool by AMM ID or from the dropdown menu.
2. Set Rewards and Duration
Rewards: Choose one or multiple reward tokens (up to 5) and set the reward amount.
Duration and Start Time: Choose the farming period duration (7 to 90 days) and set the start date and time. Once set, the start time cannot be adjusted.
Note: Farms usually appear on the UI within 5 minutes of creation. Rewards will only emit if LP tokens are staked; consider staking a small amount to display an initial APR.
3. Review and Confirm
Double-check all settings (rewards, duration, and start time) before finalizing.
Click "Create Farm" to confirm. Once submitted, the farm should be live on the UI within about 5 minutes, appearing under the 'Show Created' tab in the Ecosystem farms section.
4. Extend or Adjust Rewards
You can manage your created farms on the Portfolio page under "My created farms".
Extending Rewards (Same Emission Rate): Additional rewards can be added to the farm 72 hours before the current farming period ends. This maintains the same emission rate while extending the duration.
Adjusting Rewards (New Emission Rate): To change the emission rate, you’ll need to wait until the current period ends. Then, start a new period and adjust the reward amount and emission rate accordingly.
Adding Additional Reward Tokens: You can add up to a maximum of 5 reward tokens, with each token having a unique rewards period if needed.
And that’s it! You’re now bootstrapping decentralized liquidity on XenDEX.
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