Yield Farming: APR vs. APY and the Cost of Compounding
Use worked calculations to separate simple rates, compounding assumptions, token incentives, and a strategy’s net outcome.
Reading collection / DeFi Field Notes
Staking & reward accounting.
Compare staking arrangements with the arithmetic used to describe their rewards. Direct operation, pooled participation, and liquid receipts involve different responsibilities, while rate displays may use different compounding and fee assumptions.
Use the staking article to map control and exit routes. Then review APR and APY to understand what a displayed reward rate does and does not describe. Keep the quantity of the underlying asset separate from its value in another currency. A transferable receipt adds flexibility without automatically making an urgent exit predictable, and a convenient automated process does not remove its dependencies.
Use the linked guides below for worked explanations, source references, and connected reading. Keep the glossary open when a term needs a definition, and review the limitations of educational material before applying an example to a real position.
