APY (Annual Percentage Yield)
APY, or Annual Percentage Yield, is a measure of the rate of return that users earn when they deposit their funds in different cryptocurrency lending protocols and yield farming platforms. APY includes the effects of compound interest, which can transform low daily or hourly yields into significant amounts over time. Since APY reflects the investment return over one year, advertised rates should only be expected if funds are deposited for that time horizon. Yields can also vary at any time due to a multitude of factors, such as token price and additional token incentives.
If you want to calculate the APY for your investment, you can use an APY calculator like the one found on CoinGecko here. Note that the displayed APY is based on an estimated calculation using the current market price and reward rate. It does not account for market fluctuations, gas fees, and smart contract risks. Your individual profitability may vary.
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