Crypto market intelligence firm, IntoTheBlock, has released a report outlining the most risk-adjusted strategies to earn yield in the decentralized finance (DeFi) sector. The report highlights Automated Market Maker (AMM) Liquidity Provisioning, where users deposit assets into AMM pools for various trading pairs, earning yield from trading fees. However, the volatility of the assets creates the risk of impermanent loss for investors.

Another strategy is "recursive lending", where users can supply and borrow the same asset, profiting from the difference between borrowing costs and protocol incentives. The firm recommends lower leverage when depositing over $3 million in assets due to yield drop as more capital is added.

"Supervised lending" is also discussed, where users use an unproductive asset as borrowing collateral, then use their borrowed funds to buy a more productive asset that earns yield. However, borrowing rates can often exceed protocol incentives, and this strategy contains risk of both liquidation and impairment loss.

Lastly, "leveraged staking" is highlighted as a strategy for producing medium returns on assets like ETH or SOL, which can be natively staked for yield. Returns rise as leverage rises, potentially exceeding 10% APY, compared to 2% to 4% yields generally seen with simple staking. IntoTheBlock warns of a complex chain of risk considerations when rebalancing and taking profits.