APY Calculations

APY (Annual Percentage Yield) reflects the annualized return with compounding factored in. This is particularly useful for restaking, as Renzo auto-compounds rewards received from both staking and restaking, allowing users to save on gas fees and receive additional rewards.

1. Auto-compounding

   • Staking and restaking rewards are automatically redeposited into the protocol, increasing the amount of collateral a user is able to claim without increasing the supply of the asset. Thus, the price of the asset increases as rewards are harvested. No manual claiming is required.

2. Determining APY

• The APY displayed in the app is calculated directly from the asset’s price change over a trailing observation window (default 30 days) and annualized:

APY = (1 + (Δprice / starting price))^(365 / days) - 1

• Δprice = current price – starting price

• Starting price = price at the beginning of the window

• Days = number of days in the look-back period (defaults to 30)