Step-by-step Guide: Providing Liquidity and Yield Farming on SushiSwap

When it comes to liquid staking, anyone can hold onto stakedTokens (stTokens) and earn staking rewards, while at the same time, participate in DeFi activities such as yield farming. So what exactly is yield farming? Yield farming is also known as liquidity mining, which is just another DeFi term for additional rewards given to liquidity providers via staking. There are essentially two parts to the process of yield farming: (1) providing liquidity, (2) mining your liquidity pool (LP) tokens. In this article, we will be covering (1) providing liquidity.

In summary, StakeHound’s stToken liquidity providers get to earn 3 different rewards:
1. Staking rewards (varies between tokens)
2. Trading fees (0.25% of all trades proportionate to your liquidity pool share)
3. SUSHI Rewards (governance token on SushiSwap)

For example, if Adam is to provide liquidity to ETH-stETH pool, the rewards are:
1. stETH Staking rewards at 7.87% APY
2. Trading fees of pool share: 0.25% per trade proportionate to pool share
3. Additional SUSHI Rewards: 73.65%(1y)

*As staking rewards vary from time to time, the above numbers are as of writing.

If Adam provides liquidity to a multi-staked Token pool (eg. stETH-stDASH), this means that Adam will get to earn Staking rewards from both, Trading fees of pool share, as well as SUSHI Rewards on the Onsen (depending on if it is listed). Now that you understand how the rewards work, here are the step-by-step instructions. In this article, we will be covering both parts on SushiSwap.

Before you begin, you will need:

1. MetaMask Wallet
2. Both ETH and/or stETH in your wallet depending on which token you are providing liquidity to. Both should be in equal value.


(PART I) Providing Liquidity

1. Head to SushiSwap Exchange or access the correct Liquidity Pool directly (if link is provided). Click on “Pool” on the top left (if you are not directed to the right pairing).

2. Click on “+Add Liquidity“. As you can see in the screenshot, Liquidity Providers are rewarded a 0.25% fee proportionate to their liquidity pool share.


3. Both are input options indicated on the screenshot below. Select the correct stToken if you have already imported it previously. Otherwise, use the right token address.

Note: You can find all the token addresses from our FAQ document. Kindly note that token addresses for mainnet and testnet are different. You cannot transfer testnet tokens to the mainnet, vice versa. To put it simply, the mainnet consists of your “real” crypto, while the testnet consists of “fake” crypto. You can check which network you are on via your MetaMask wallet on your browser extension.

In this example, we are using the ETH-stETH pool. If you are providing liquidity to other stToken pools, make sure that two tokens’ contract addresses are correct. Next, key in the amount you would like to contribute to either of the tokens. The other “Input” amount will be automatically populated based on the current price of the token. Hit ‘Approve stETH‘ (screenshot below). If you already hold enough balances for both tokens of the pool, you will skip this step (Skip to step 5).


4. Your MetaMask extension will pop up requesting confirmation of the transaction, along with the number of transaction fees required. Hit ‘Confirm‘.

5. Once you have approved supply, you would now need to supply. Indicate the amount of stETH/stToken you would like to supply again, and hit ‘Supply’. Please note that each action of supplying and staking usually requires 2 transactions (2 x ETH gas fees), so do plan beforehand.


6. You will then see another screen that shows you the Pool Tokens (LP Tokens) you will receive according to your pool share. Hit ‘Confirm Supply‘ (as in the screenshot below). You will then be led to another MetaMask pop-up to confirm the transaction.

At this point, you will have completed the liquidity provision and an SLP (SushiSwap LP token) token which represents your share of this liquidity pool. If you would like to earn more rewards, you can consider staking your SLP – which is also known as yield farming.


(PART II) Staking your SLP on Onsen Farm

1. Head to Onsen Farm on the SushiSwap app.

2. Connect to your wallet if you haven’t already.

3. Under ‘Filter’, search for your stToken pairing. In this example, we’re searching for “stETH”. You will see a WETH-stETH pairing. You can also have an overview of the ROI, liquidity of the pool, amount you have staked, and your total SUSHI earnings. On the right, you can quickly add liquidity or “Approve Staking” (which is staking your SLP). Once you already have your SLP by providing liquidity in part 1, you can proceed to stake your SLP here under ‘Approve Staking’. That’s all you really need to do. Please note that you’ll be required to go through two transactions – (1) Approve Staking, (2) Staking, which means that it will incur ETH gas fees for both.

Checking Positions and Balances

To know what your current positions and balances are, head to your SushiSwap portfolio. You have to connect your wallet to see the balances and positions. You can also access this page by heading to, connect your wallet (just below Sushi’s logo on the left), and click on ‘Portfolio‘. On this page, you are able to look at the transactions you have made through Sushi and the connected wallet. At the same time, view the SUSHI rewards you would have accumulated (via yield farming, not included in this article), your liquidity pool positions, as well as the specific farms you have “staked” your SLP tokens on.


Removing Liquidity

If for some reason you would like to remove liquidity from a pool, you can also do so via Connect your MetaMask wallet, go to “Pairs” and search for the pair you provided liquidity to. It will look similar to the screenshot below. Now, instead of “+ Liquidity”, select “– Liquidity” in the box on the right. You can then select the percentage of liquidity you would like to withdraw.


Just an additional note: Every transaction and confirmation will require ETH gas fees. Plan your movements in advance and watch the market to make the best of your stTokens.

Have Questions? Join our stETH community on Discord!