Crypto Lending Calculator

It is the annual probability of the platform going under at which the yield exactly cancels out the expected loss, assuming you get nothing back. At 8% APY it is about 7.4% a year — so lending at 8% is only worth it if you genuinely believe the platform is more than 92.6% likely to still be solvent and paying out in twelve months. It is a blunt measure and it ignores partial recovery, but it turns 'is this rate good?' into a question you can actually answer.

No, and the difference is who has your coins. Staking locks your coins in a protocol and pays you for securing it; the main risks are the protocol, slashing and the lock-up. Lending hands your coins to a company that lends them on to someone else, and adds that company's solvency to the list. The yields look similar on a marketing page and the risks are not.

Because someone is paying more to borrow, or because the platform is taking more risk to generate it, or because it is subsidising the rate to attract deposits. A rate well above the market is information about risk, not a bargain — several of the highest-paying lenders of 2021 and 2022 stopped honouring withdrawals entirely.

Far less than people expect. A quoted APY already includes compounding, so choosing daily over monthly changes the outcome only through when interest lands in your account. The platform's cut and whether you get your money back matter orders of magnitude more.

In most countries interest is income at the moment you receive it, valued at that day's price, and then a later sale of those coins is a separate capital gain. That is a different treatment from a simple buy-and-hold, and it means a good year for lending can create a tax bill on coins whose value has since fallen.