When you put money to work—whether in a savings account, a crypto staking pool, or a DeFi protocol—you care about one thing: how much you actually earn. That’s where Annual Percentage Yield, the real rate of return that includes compounding interest over a year. Also known as effective annual rate, it’s not just the headline number you see—it’s what your money actually grows to after interest is added repeatedly. Most platforms advertise a simple interest rate, like 5%, but if that interest compounds daily or hourly, your real return is higher. APY captures that difference. Without it, you’re guessing.
In crypto, APY is everywhere. Staking ETH on Lido, locking up USDC in Aave, or farming liquidity on Uniswap—all of these rely on APY to show you the true potential return. But here’s the catch: not all APYs are created equal. Some are fixed. Most are variable, changing with market demand. Some are inflated by token rewards that crash after a few weeks. That’s why you can’t just chase the highest number. You need to understand what’s behind it: the compounding frequency, the risk of the protocol, and whether the yield is sustainable or just a short-term giveaway. In DeFi, an APY of 20% might sound amazing, but if the underlying asset loses 30% in value, you’re still down. APY doesn’t protect you from price drops—it only tells you how fast your balance grows if everything stays stable.
Traditional finance uses APY too. Banks list it on savings accounts because federal rules require it. Crypto doesn’t have those rules. That’s why you see wild APYs on new tokens that vanish overnight. The same APY formula applies whether you’re earning on a bank CD or a Solana staking pool: it’s (1 + periodic rate)^compounding periods - 1. But in crypto, the periodic rate can change every block. And the compounding? Sometimes it’s every minute. That’s why APY on crypto platforms often looks like magic—it’s not. It’s math, but math with high risk and low transparency.
You’ll find real APY examples in the posts below: how BTCC offers high leverage but no staking, why HTX Thailand users care about yield on stablecoins, and how DeFi protocols like Divergence and Anypad use APY to attract liquidity. Some posts warn you about fake APYs hiding scams. Others show you how to compare yields across exchanges and wallets. You’ll learn what to look for when a platform says ‘Earn 15% APY’—and what they’re not telling you.
Learn how to calculate crypto staking rewards using APY, understand compounding, and avoid common traps. See real examples of Ethereum, Solana, and DeFi staking returns.