DeFi APY Calculator

Work out the APY you really get in DeFi once gas is paid on every compound, how often to compound, and whether an auto-compounding vault does better.

Your deposit

Before compounding.

Compounding

To harvest and redeposit, all steps.

Optional: to compare an auto-compounding vault, which compounds daily for you.

Your APY after gas

Enter your deposit, the APR and the gas each compound costs, then choose Calculate. Your figures appear here.

APY as You Compound

0%

After gas

Gas a Year

₹0.00

At your frequency

Best Frequency

Not set

Where gas and compounding balance

APY Shown, Before Gas

0%

Daily compounding, free

Auto-Compounding Vault

Not set

Enter its fee to compare

Best APY After Gas

0%

At the best frequency

Over a year at a steady APR and gas, with gas paid from the rewards. Impermanent loss, the reward token’s price and tax are not counted; for a liquidity pool, use the DeFi Yield Calculator.

How it is calculated

Each compound adds the rewards so far to your deposit and costs one gas fee, paid from the rewards. Compounding more often earns rewards on rewards sooner but pays gas more times; the best frequency is where the two balance.

  • Balance after a year = deposit × qn − gas × (qn − 1) ÷ (q − 1), with q = 1 + APR ÷ n, compounding n times
  • APY after gas = balance after a year ÷ deposit − 1
  • Best frequency = the n from 1 to 365 that leaves the largest balance; roughly APR × √(deposit ÷ (2 × gas))
  • APY shown = (1 + APR ÷ 365)365 − 1: daily, with no gas
  • Vault APY = (1 + APR × (1 − performance fee) ÷ 365)365 − 1

Frequently asked questions

Short answers on DeFi APY, gas and how often to compound.

The APY you really get once gas is paid on each compound, and how often to compound. Deposit ₹1,00,000 at a 20% APR with ₹50 of gas each time: compounding weekly gives 19.22% after ₹2,600 of gas, but daily gives only 1.94%, because gas of ₹18,250 eats the rewards. The best is about every 52 days, for 21.42%. Sites would show 22.13%, and a vault taking a 10% fee would give 19.72%.

APR is the yearly rate before compounding; APY includes rewards earned on rewards when they are added back to the deposit. A 20% APR compounded daily is a 22.13% APY, but only if compounding is free. In DeFi each harvest and redeposit is a transaction with a gas fee, so the APY a site shows is a ceiling. The Crypto Compound Interest Calculator converts an APR to an APY without costs.

Because each compound pays gas, and the extra rewards from compounding one more time shrink as you compound more often. On a small deposit or an expensive network, daily gas can cost more than the rewards themselves. On a cheap network or a large deposit, gas hardly matters and frequent compounding gets close to the APY shown.

Roughly APR × √(deposit ÷ (2 × gas)) times a year. For ₹1,00,000 at 20% with ₹50 of gas, that is about 6 to 7 times a year; with ₹5 of gas, about 20 times; with ₹10,00,000 and ₹50 of gas, about 20 times. This calculator finds the exact best number. Gas changes with network traffic, so compound when fees are low rather than on a fixed day.

Vaults compound for many depositors at once, so the gas is shared and they can compound often; in return they take a performance fee, usually 5% to 20% of the rewards. For small deposits a vault usually beats compounding yourself; for large ones on cheap networks, doing it yourself can pay more. A vault also adds its own smart-contract risk on top of the pool’s. Enter the vault’s fee to compare.

Impermanent loss in a liquidity pool, a fall in the price of the reward token, APRs that drop as more money arrives, and tax. In India each harvest is usually treated as income when received, at your slab rate, so frequent harvesting also means more records to keep. The DeFi Yield Calculator counts impermanent loss and gas against holding the tokens.

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