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Annual Percentage Yield

Annual Percentage Yield (APY) expresses a rate as an annualized percentage using an assumed compounding method. On Euler, displayed rates can combine borrower-funded lending yield, an asset's intrinsic yield, and campaign rewards. These components have different sources and risks, and all can change.

Annualization

If r_p is the rate for one compounding period and n is the number of periods in a year:

APY = (1 + r_p)^n - 1

Before comparing rates, check whether each source reports APR or APY, its compounding convention and sampling time, and whether it includes fees, intrinsic yield, or rewards.

EVK lending and borrowing rates

EVK interest-rate models return a per-second compounded borrow rate called SPY, scaled by 1e27. Euler's Utils lens uses an average Gregorian year of 365.2425 × 86,400 seconds:

borrow APY = (1 + borrow SPY)^seconds_per_year − 1
utilization = borrows / (cash + borrows)
supply APY = borrow APY × utilization × (1 − interestFee)

Here, borrow SPY is the unscaled per-second rate and interestFee is the normalized fee fraction. The IRM supplies the borrow-rate input; utilization, fees, and vault accounting determine the supplier rate. High supply APY can indicate high utilization and limited withdrawal liquidity.

Rate components

  • Lending APY: interest paid by borrowers, after the effect of utilization and the configured interest fee.
  • Intrinsic APY: yield produced by the underlying asset or its protocol rather than EVK borrowing.
  • Reward APR: the estimated annualized value of a campaign. It is not compounded by the EVK vault.
  • Borrow APY: the annualized cost of debt from the liability vault's rate model.

An interface may combine these into a headline or net rate. Adding APR and APY percentage points is a display convention; it does not make campaign rewards protocol-compounded yield.

What to verify

  • Separate lending, intrinsic, borrowing, and reward components.
  • Check the rate timestamp, annualization method, utilization, liquidity, IRM, and live fee configuration.
  • Confirm campaign eligibility, funding, vesting, claimability, and whether rewards are already included.
  • Account separately for token-price changes, slippage, gas, external fees, taxes, and redemption constraints.
  • For debt positions, review oracle and liquidation risk; APY does not include liquidation losses.

Sources

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