# Farming and Staking

There are two options available at launch for liquidity farming on Skeleton Money. 

1. V2 Staking
2. V3 optimised farming

## How do I Create and Stake using the V2 Methodology?

Create V2 LP tokens by pairing two tokens manually on the Liquidity page.

* Create V2 LP tokens by manually pairing your tokens on the DEX
  * Participants can also utilise the ZAP functionality for this
* Navigate to the farming tab and stake your V2 LPs in the appropriate farm to start earning rewards
* Users earn $BONE as staking rewards.

## How do I Create and Stake using the V3 Methodology?

Zap into V3 Farming

* Zap into V3 Farming
  * The V3 farming option allows users to zap their $S tokens directly into V3 LP pools

## How do I use the ZAP function?

* Use the Zap function on Skeleton Money to convert $S tokens into V3 or V2 LPs
  * V2 and V3 LPs are then rehypothecated into a decentralised exchange’s V3 pool, with automated management for maximum efficiency.

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All liquidity (V2 and V3)  are automatically managed by our contracts to optimise yield through rehypothecation
{% endhint %}

## Additional Details for Staking

* Flexible staking and unstaking: stake and unstake your LPs at any time, with rewards distributed every block.
* Fees: V2 and V3 LPs incur no deposit/withdrawal fees on native pairs, while non-native pairs have a small deposit/withdraw fee.
* Reward distribution: both V2 and V3 farming options reward the $BONE token, whilst the deposit/withdraw fees benefits those who stake in their $BONE in the Skull Federal Reserve.