I've been farming yield for a while now, and the most useful thing I've built for myself is a short checklist. Every time I look at a new vault or position, I run through the same seven questions before putting any money in. This isn't a comprehensive list, but it's great to start your analysis.

1. Where is the yield coming from?

This is the first thing to check. Is the return coming from borrowers paying interest, from trading fees, from staking rewards, or from bonus tokens handed out by a protocol? Each source works differently and has a completely different shelf life. If the yield comes from real activity like borrowing demand or swap fees, the position is more likely to be a set-and-forget strategy. That yield exists because people are using the protocol, and it persists as long as usage continues. If the yield comes from token emissions, it requires more active management. You need a strategy for the emitted tokens: sell immediately, hold for upside, restake into another position, or some combination. Emissions-based yield is an active strategy, and treating it like a passive one is how you end up holding depreciating reward tokens.

2. How much of the yield is base vs. bonus?

Always split these apart. If a vault shows 18% APY, you want to know what % is from lending interest and what % is from a bonus campaign. If it’s 4% from lending and 14% incentives, I’ll know that the 4% sticks around as long as borrowers exist. The 14% disappears when the campaign budget runs out.

3. When does the bonus expire?

Campaign rewards run on a schedule. Some last two weeks, some last three months. If you're entering a position mostly for the bonus, you want to know the timeline before you deposit. I actually put these dates in a calendar so I know when to move my positions.

4. How fast is the vault filling up?

Rising deposits dilute your yield. If a vault jumped from $5M to $50M in a week, your share of the rewards is a fraction of what earlier depositors received. Check the TVL trend before entering.

5. How many smart contracts are you trusting?

A direct deposit on Aave is one contract. A vault managed on Morpho with bonus rewards flowing through Merkl is three layers of smart contracts. More layers means more places where something can go wrong.

6. Who built this, and how long has it been running?

The team behind a protocol matters. Older, battle-tested protocols with doxxed teams and years of operational history are generally considered safer than brand new projects with no track record. Check whether the team has raised funding and who backed them. VCs are a controversial topic in crypto, and there are valid reasons people are skeptical. That said, if a project is backed by firms like a16z, Paradigm, or Pantera, the legitimacy of the project tends to be higher than one with no backing and a completely anonymous team. VC backing is a signal, and it means the project went through some level of due diligence before receiving capital. It's one data point among many, but it's worth checking.

7. Can you leave when you want to?

Check whether there's a lockup period, and if the position involves an LP pair, look at the liquidity depth. For bonus rewards that vest over time, you want to know the schedule upfront. The affects the risk-profile especially if the vest if well into the future. Just like in TradFi with stock investing, there’s always a discount-to-future that you need to use in your analysis.

How I applied this to positions I hold

Aave USDC on Ethereum: Yield comes from borrower interest. Current rate is around 2-3%. There's no bonus layer. It has just one smart contract and is fully liquid. This is my simplest position and my baseline for comparison.

Stablecoins on Turtle: Base yield comes from lending through Morpho, Aave, and Euler. Bonus comes from bonus tokens distributed through Merkl. Additional Turtle Shells earned for providing liquidity through Turtle’s frontend. I track these separately. Most breakdowns are ~3-5% base + 5-10% bonus. Each campaign has a set end date. I'd move my capital if the base yield + ¼ of the bonus dropped below what I can get on Aave. This is my personal preference, but I always add a discount to bonus rewards. If you want to understand how these incentive campaigns work under the hood, this guide covers it well: https://www.turtle.xyz/resource-hub/the-complete-guide-to-defi-incentive-infrastructure-2

Spectra PT (USDC, Katana). Fixed rate locked at ~7% until the maturity date (August 2026). No bonus. I like Spectra & Pendle because they are yield-capturing protocols. Basically, I get a guaranteed rate through PT tokens as long as i hold through the maturity date. This is the closest thing to bond markets we have in DeFi. The risk is smart contract exposure plus the opportunity cost of having my capital locked until maturity.

Turtle is my preferred platform for stablecoin farming because the base yield is comparable to what you'd get elsewhere across DeFi, but I get added boosts from incentive campaigns and earn Turtle Shells on my positions. That said, this checklist doesn't require anyone to deposit into any specific vaults. It's a framework for evaluating opportunities wherever you find them. Where you end up depositing comes down to personal preference and risk tolerance.