APR (Annual Percentage Rate)
Annual Percentage Rate (APR) is the simple interest rate earned or paid over one year, without accounting for compounding. In DeFi, APR represents the base rate before compound interest is factored in.
Understanding the Concept
• Doesn't include compound interest (simpler calculation) • Always lower than APY for the same nominal rate • Common in lending protocols and liquidity mining • Easier to calculate: principal × rate × time
Real-World Example
A lending protocol shows 10% APR on your stablecoin deposit. On $10,000, you'd earn exactly $1,000 over one year if you withdrew interest as earned. If you left interest to compound, your actual return (APY) would be higher, around 10.5% with monthly compounding.
How Strykr Helps
Strykr tracks APR developments across the crypto ecosystem. Our AI provides real-time insights and alerts to help you navigate the market with confidence.
Try Strykr Free