What are the pros of yield aggregators and why should I use them?

• They combine a variety of protocols and strategies to maximize investor returns
• Save investors time, which they can then use to analyze or research other eligible projects for further investment
• Investors can more easily access information about new investment opportunities because the yield aggregator has a "list" of everything it interacts with on one platform

Yield aggregators also have their disadvantages. What should I be aware of when using them?

• The risk of a possible Impermanent Loss (IL), which can significantly affect the size of the yield if the price of the underlying assets starts to change
• Risk of possible liquidation, which may lead to a complete loss of the invested digital assets. Liquidation risk occurs when investors borrow funds, use leverage and the value of their collateral falls below a predetermined liquidation threshold.
• Risks associated with hacking attacks because they involve many layers of various protocols

How do I choose a trustworthy yield aggregator?

1. You need to conduct thorough research of each platform, visit social networks (Twitter, Discord, etc.), and ask the community for their opinion about the project and the team. What experience does the team have, what previous projects has it fronted, who does it have partnerships with?
2. Check if the development platforms have been through KYC. If not, it is possible that nobody knows their real identity, so there is always some risk of your funds being stolen directly by the developers.
3. Check if the platform has been audited. Smart contracts on blockchains are publicly available and their code can be checked by anyone. It is these codes that are audited by many reputable companies to help ensure their security. Despite this check, which is called an audit, it is possible for a hacker to find flaws in the code that the auditors were previously unable to predict in the first place. Not every yield aggregator is truly trustworthy, and past experience has shown that thefts can result in large financial losses for users, greatly affecting their motivation to continue investing their time and money in digital assets and Web 3.0. Always be prepared to accept a certain amount of risk and diversify your investments wisely. Your main task is to ensure that you are earning consistent profits for the minimum possible level of risk. Always DYOR!
4. Before choosing a suitable yield aggregator, investors should compare the fees, each platform will charge for managing their investment and the interest rates within each investment strategy, as these can vary significantly between platforms.

Conclusion

Yield aggregators assist DeFi investors with increasing their overall Annual Percentage Yield (APY) while saving them time by claiming and swapping the necessary assets in a specific LP delivering a steady return.
In addition to great potential rewards, yield aggregators also carry certain risks. Because of how the system is built, different layers of protocol are involved in the process of operation, making it easier for threats such as fraud and bugs to be exploited by hackers.

Personal Opinion

Yield Aggregator simplifies passive income generation for cryptocurrency farmers. Thanks to the technology, they have fewer concerns to focus on, because all the necessary operations that they would have had to perform manually themselves are automated. At the same time, the yield aggregator maximizes their potential returns by periodically re-staking the rewards they have already earned. As investors, however, you should never forget about your investments in yield aggregators! You should regularly check the performance of your assets so that if something is not going according to your investment thesis, you can exit one fund and invest in another. By watching yield farming, you reduce the risk that your yields will start to turn into losses. Bear in mind that in the current climate in particular, a critical event could occur that then triggers this type of undesired scenario in a matter of days or even hours.