APR versus APY

Annual Percentage Rate (APR) and Annual Percentage Yield (APY) may seem similar or the same to many people. However, knowing the difference and how they are used will help you make better financial decisions and improve your financial IQ

What is APR?

APR (Annual Percentage Rate) is your annual rate of return before factoring in compound interest. It is oftentimes expressed as a percentage.

You will likely come across APR when you are reading through loan terms. This will show you how much you will have to pay in interest in order to borrow.

Interest payments on Celsius Loans are made on a monthly basis.

Celsius Network posts borrowing rates in APR. Reward rates are NOT posted in APR.

What is APY?

APY (Annual Percentage Yield) is the annual rate of return after you factor in compound interest. Just like APR, APY is oftentimes expressed as a percentage.

You will likely come across APY when you are depositing assets into a savings account earning interest/yield. This will show you how much you will earn.

Reward payments on Celsius deposits are made on a weekly basis.

Celsius Network posts reward rates in APY. Borrowing rates are NOT posted in APY.

Remember to use APR rates to calculate individual weekly rewards.
For example: if you have 100 MATIC earning in-kind, you need to convert the posted 10.51% APY to APR. This gives you 10.00% APR. The calculation is 100 * 10.00% / 52 weeks = 0.1923076923076923 MATIC. The same goes for earning in-CEL… just choose the APY for your Loyalty Tier, convert to APR and run the same calculation.