Newby Question about DEFI Compound and Yield detail.

2 Questions about Defi Guys.

1st Question

So I was watching a video about Uniswap or Curve Defi exchanges and in the video the author was saying that when you deposit your coins to Yield Farm that one of the risks is that if the price goes up or down you are either shorting or longing yourself. I do not understand how so, perhaps I dont fully get the conecept, when we choose to withdraw our coins from the Yield Farm do we get exactly the same amout of coins we deposited? If so then how are we shorting or longing ourselves?

2nd Question.

For DEFI Compound Finance exchange when we deposit into "supply markets" and choose to have use our deposit as collateral to borrow other coins , I can see that different coins have different APY %, for example BAT has 25% and Ether has 3%... So firstly, for example if my collateral is 100 dollars and i withdraw 100 dollars worth of BAT that has 25% APY to borrow will I automatically instantly only get 75% of BAT market value for the sum of 100 dollars? Also If to borrow BAT is 25% APY but to borrow ETHER is 3% APY, why would I do that when I can borrow ATHER for cheaper APY then move it to another exchange and trade it for BAT?

Thanks for your time.

Topic: Newby Question about DEFI Compound and Yield detail. (Read 108 times)