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What is a Crypto Staking Calculator?
A crypto staking calculator allows investors and on-chain users to easily calculate the yields from their activities in decentralized and centralized finance. It is particularly useful as a way to project potential earnings from staking activities to make a decision on the risk/reward you take with the smart contract.
Staking, an innovative process in the crypto world, involves securing or 'locking up' a certain quantity of cryptocurrency in a digital wallet. This action supports the functioning of blockchain networks or on-chain applications such as Lido, Frax Finance, Curve Finance and more.
What is the Staking Calculator Formula?
At Datawallet, our Crypto Staking Calculator employs the following formula:
- Potential Earnings = (Staked Amount * Staking Rate / 100) * Staking Period
The variables are:
- Staked Amount: The quantity of cryptocurrency to be staked.
- Staking Rate: The annual percentage yield (APY) of the staking reward.
- Staking Period: The duration for which the cryptocurrency is staked.
This formula provides an estimate of your returns, however it is important to note that most staking rates in DeFi are variable, so the yields are always subject to change.
Crypto APY vs APR
APY and APR are key metrics for comparing investment options, especially in crypto staking. APR, a straightforward rate, neglects compound interest and offers a basic annual return from staking. Conversely, APY factors in compounding, providing a more accurate annual yield for the crypto investor.
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