If you’ve got $POTS or $BUSD sitting in your wallet, putting them in a PancakeSwap liquidity pool (LP) is a great way to earn large APYs on your funds. You can also stake those LP tokens with Beefy to autocompound the yield you get.
What’s a liquidity pool?
A Liquidity pool is a pool of two tokens that users can either add liquidity to or swap tokens with. Liquidity providers add two specific tokens to the pool in equal value, and swappers exchange one token for another from the pool for a fee.
The fee is split across liquidity providers according to their share of the total liquidity. The price is decided by an Automated Market Maker mechanism that determines price from the balance of the tokens in the pool.
Any funds staked in an LP are at risk of impermanent loss if the prices of your tokens appreciate or depreciate from their original value.
For more information, check Alexandria’s Liquidity Pool explainer.
How to stake with Zap
Zap is a tool by Beefy Finance that allows you to stake in Liquidity Pools with either both tokens in the LP or just one token. Zap will add your token(s) to the LP and automatically yield farm it all in one go. You can also remove your stake and cash out either both tokens or just in one.
Head to the POTS-BUSD LP or POTS-BNB ALP pools and select the one you want to stake in.
Here you can see the POTS-BUSD LP Vault. We’re going to Zap just $POTS. Zap will convert half our $POTS into BUSD and enter them both in the LP. Click the drop-down just above the percentage slider.
Here we have selected POTS.
Now, select the number of POTS you want to add to the LP, yield farm, and then boost. Click [Approve].
Press [Confirm].
Check the amount again and press [Deposit].
Press [Confirm] to successfully deposit your $POTS.
How to stake manually
In our example, we’re going to stake $POTS and BUSD in the PancakeSwap $POTS-BUSD LP. We’ll then add the LP tokens to the Beefy POTS-BUSD LP yield aggregator pool.
Make sure to have some BNB for your network transaction fees too.
First, make sure your wallet is connected to PancakeSwap and head to the [Liquidity] tab. Then click [+ Add Liquidity].
You’ll now see the option to add your two coins to an LP. Click [Select a currency] in the top field to add the first.
We’ll add “$POTS” first. Search for Moonpot and click the [Import] button if you haven’t already added it.
Tick the [I understand] button before clicking [Import].
Click [Select a currency] in the bottom field next.
Type “BUSD” and or select it from the [Common bases] section.
Next, input the amount you want to add. You can do this with either the POTS or BUSD field. PancakeSwap will make sure both are in equal amounts. Next click [Supply].
Check the details of your deposit and click [Confirm Supply].
Choose your network fee and [Confirm].
You’ll now see the [Transaction Submitted] splash screen.
You’ll then receive a receipt for your LP tokens if your deposit was successful.
Next, head to Beefy Finance and search for the POTS-BUSD LP vault. Tap on the pool to start the yield farming process.
Select the amount you want to add then click [APPROVE].
Choose your network fee and click [Confirm].
Beefy will now be able to interact with your wallet. Double-check the amount you want to deposit and click either the [DEPOSIT] button for a specific amount or [DEPOSIT ALL] for all your LP tokens.
Choose your network fee and click [Confirm]
You’ll now see a [Deposit success] message if all has gone well.