I have been farming on Pancake Swap since late February 2021 and since I started all the farms were all running up until today. Today, I have noticed that some of the farms on my Pancake Swap Account are finished. To be exact, 4 out of the 10 farms are already done. Since it’s the first time that I’ve experienced this, I’m wondering what to do when a Pancake Swap Farm is finished so I did some online research and so far, here’s what I’ve found out.
By the way, before we continue, please be informed that this is not a piece of financial advice. I’m just sharing my personal journey about crypto trading and investing. If you need financial advice on any investment, please consult a professional financial advisor. And also, always Do Your Own Research (DYOR) and always double-check any information that you see online.
Note: (Update as of January 30, 2022) I have discontinued using Pancake Swap since late last year (2021) but since I have not been able to update my blog for the last six months I’m just updating this now (01/30/2022). Please be informed that the information you see here might not be updated by the time you read this. Please DYOR and check Pancake Swap’s official website and social media channels for their most recent updates.
What is a Pancake Swap Farm?
Before we discuss the available options on what to do once a Pancake Swap farm is finished (has ended), let’s discuss first what is a Pancake Swap Farm?
In Pancake Swap, a Farm basically means where you will put your liquidity pool token to earn rewards, in this case – $Cake.
Farming $Cake on Pancake Swap comes with a risk of course, and the biggest risk is Impermanent Loss. It happens when the price changes between the asset that you have deposited to generate an LP token.
Impermanent loss is one of the reasons why some people don’t prefer farming on Pancake Swap and would rather stake a single asset to avoid Impermanent Loss.
For a full explanation of what Impermanent Loss is all about, check out this detailed explanation on the Binance Academy website.
How Would You Know if a Pancake Swap Farm is Finished?
As I have mentioned earlier, this is the first time that I experience having a farm that is finished or has ended and I noticed it when I was checking my farms on Pancake Swap.
You can check it on ‘Farms’ and then toggle on ‘Finished’ to see your farms that have ended.
What to Do When a Pancake Swap Farm is Finished?
As soon as I saw that 4 out of my 10 farms have ended, I started Googling for some information on what to do after next. And so far, here are the available options that I was able to gather as of the time of writing:
Leave It As It Is
One of the options is of course to leave it as it is, at least for the time being, or at least until a better option becomes available.
To be honest, I really don’t like this option because I won’t be earning anything if I do so and it’s such a waste of resources.
But it’s a better option for now than to take it out (in my case).
Remove Liquidity to Get Tokens Back
This is a case-to-case basis depending on the situation and of course, your personal decision.
When I created the Liquidity Pool token for this pairing, $BMXX was at $81.49/token and now it’s at $1.81 (ouch!!!).
Fortunately, I only put a small amount of money back then since I was still trying to understand how it works.
If I take my liquidity out, then I will get $BMXX and $BNB and my Impermanent Loss will then be realized.
As of the time of writing, if I take it out, my loss would be around 80% of what I have invested in this pairing, not taking into account the $Cake that I have earned though.
If I factor in the $Cake that I have earned from this pairing, then the loss would be lesser but would still be a lot due to the huge price drop that happened to $BMXX.
If I’m being realistic I don’t know what the future holds and I don’t know if it will even go back to its original price. But since I have not decided yet on what to do, I will leave it just as it is for now.
This is not the case though for all the pairings that I have. I have a $DEXE – $BUSD pairing that is doing ok. This farm has not ended yet though but when I checked Yieldwatch, the impermanent loss is very very small.
Remove Liquidity and Stake Tokens
Another option that I saw online is to stake the tokens after you have removed them from liquidity.
I saw a Tweet from Multiplier ($BMXX) about the staking option on their website with huge interest.
However, if I go this route, then I would have to remove my liquidity to get the $BMXX token thus realizing the Impermanent Loss.
So, I have to think about this first before I go this route.
If only the Impermanent loss is not that big, then I would have easily just taken it out.
Final Thoughts and What To Do Moving Forward
I do hope that Pancake Swap just re-add these farms that they have ended so I can just put it back in and continue earning $Cake. I’ve seen them do this on ‘Pools’ but I don’t know if they have done this on ‘Farms’ as well.
Luckily, I have taken profits every now and then. I always harvest the $Cake that I have earned from my Pancake Swap Farms and I have reinvested them in other projects in BSC. In doing so, I’m close to recouping the initial investment that I have put in crypto – specifically on Pancake Swap.
I should have documented it clearly per pairing though so it would be clearer if I have profited or just broke even for a specific pairing.
Moving forward, I think I might stick to a pairing with a token that might have a better chance of doing well regardless if it is bull or bear market, or something that has better fundamentals than my earlier pairing picks.
Another option also would be to become a liquidity provider for stable coins. Since stable coins are almost of the same value, Impermanent Loss is not that much. The caveat though is the interest is wy smaller and comparable to what you will earn if you stake a single asset.