How do rewards work?

When you lend stablecoins, your tokens earn interest based upon the daily APR (Annual Percentage Rewards), and your aTokens will automatically increase to match your interest earned. Interest is calculated by demand; the more borrowers a lending pool has, the higher the APR will be.

With compounded interest, the longer you lend tokens, the more rewards you’ll earn. Every day, the interest you earn is bundled into your loaned tokens, allowing your rewards to compound over time.

FAQs

Why is the reward rate so high?

Noticed an extremely high APR? High APRs can occur when there are more borrowers than lenders in a lending pool. This demand can cause the APR to reach high peaks, and your loaned tokens can earn those rewards.

Why does the reward rate fluctuate so much?

The APR is based upon the borrowing demand for loaned tokens. As tokens are borrowed and returned, this rate automatically updates. Generally, the yearly interest rate can be between 3-15%.