# Introduction Yield farming is becoming increasingly popular among investors in Decentralised Finance (DeFi). When done right, yield farming can generate exceptional profits, but there are also associated risks. Let’s dive a little deeper and see what yield farming is all about. Yield farming is the investment in cryptocurrencies or tokens via decentralized apps (DApps) as [**Spectrumswap**](https://spectrumswap.com) yield farm platform to maximize profits. A proficient yield farmer can not only gain profit from price appreciation in their holdings, but also from yield generated by these holdings. By locking assets in liquidity pools such as the ones found on [**Spectrumswap**](https://spectrumswap.com), investors can generate passive income. Most of the yield farming on DeFi is done via liquidity pools. A liquidity pool is a smart contract that holds on to and locks the cryptocurrencies/tokens of investors. Liquidity providers contribute to the liquidity of a trading pair pool, such as **Spectrum-BNB**, by depositing their crypto (**Spectrum and BNB**) in the pool, receiving LP (Liquidity Pool) tokens in return. The Annual Percentage Yield (APY) of a liquidity pool generally gives a good indication how much trading fees can be earned in a pool. However, note that these rates are not fixed, and change daily based on historical trading data from the pool. In addition to the previously mentioned ways of making profit, a yield farmer also benefits from price increases of the token that he is using to farm. This is a double-edged sword: value can be lost as the price of the token declines. **Kindly remind, please always Do Your Own Research! Only Invest what you can afford to lose.** ### :sunglasses: [**BUY SPECTRUM AT PANCAKESWAP**](https://pancakeswap.finance/swap?inputCurrency=0xe9e7cea3dedca5984780bafc599bd69add087d56\&outputCurrency=0x4AE1A0D592DC4d1c51D37C2AEfE6D2572FC47F7a) --- # 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://spectrum-swap.gitbook.io/spectrumswap/introduction.md?ask= ``` 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.