DeFi Yield Farming Return Calculator
Use this decentralized finance (DeFi) yield farming return calculator to estimate how much your position might be worth after a given number of days. It combines protocol APR, compounding frequency, and token price change so you can see how much of your result comes from yield versus market movement. The outputs are estimates only and cannot predict future returns.
How this DeFi yield farming calculator works
The calculator models your position as if you deposit a starting amount in USD, earn a fixed annual percentage rate (APR), optionally compound that yield several times per year, and then apply an overall token price change. This is similar to what happens in many auto-compounding vaults or when you manually reinvest rewards over time.
The core steps are:
- Convert APR to a periodic rate based on how many times per year you compound.
- Scale that periodic rate by the number of days you stay in the position.
- Apply the compounding effect to your initial investment.
- Apply the token price change to get a final value in USD terms.
Key formulas used
Let:
- P = initial investment (principal) in USD
- r = APR as a decimal (for 20%, r = 0.20)
- n = number of compounding periods per year
- t = time in years (days invested ÷ 365)
- c = token price change as a decimal (for +15%, c = 0.15; for −10%, c = −0.10)
If you compound, the value before applying token price change is approximated by the compound interest formula:
Then the token price change is applied:
The calculator then derives:
- Final value in USD terms.
- Total return in USD and as a percentage of the initial investment.
- Impact of compounding compared with no compounding at the same APR and holding period.
Understanding the inputs
Initial investment (USD)
This is the amount of capital you plan to put into a yield farm or auto-compounding vault, converted to USD at today’s price. For LP positions or baskets, use the total USD value of all tokens you deposit.
APR (%)
APR is the annual percentage rate quoted by the protocol, usually excluding the effects of compounding. It reflects the raw yield from rewards and fees. Use the current advertised APR, but remember that it can change frequently in live DeFi markets.
Compounds per year
This field controls how often rewards are reinvested. Examples:
- 1 = once per year (effectively simple interest)
- 12 = monthly compounding
- 52 = weekly compounding
- 365 = daily compounding
- 8,760 = hourly compounding (common approximation for auto-compounders)
Days invested
Enter how long you plan to keep funds in the strategy. The calculator converts days into years to match the APR. Shorter periods will capture only a fraction of the annual yield and reduce the effect of compounding.
Token price change (%)
This represents your assumption for how the underlying token or LP position will move in price while you are invested.
- Use a positive value (for example, 20) if you expect a price increase of 20%.
- Use a negative value (for example, -30) if you expect a price decrease of 30%.
- Use 0 if you want to isolate pure yield effects (useful for stablecoin pools).
Interpreting your results
After you click the calculate button, focus on these aspects of the output:
- Ending balance: How much your position could be worth at the end of the chosen period.
- Total earnings: The difference between the ending balance and your initial investment.
- Effective return: Your total return as a percentage, including both yield and price change.
In DeFi, a high APR does not guarantee high profits if the token price falls. A strong negative token move can more than offset yield from farming. Conversely, modest APR on a relatively stable asset can lead to more predictable outcomes.
Worked example
Imagine the following scenario:
- Initial investment: $5,000
- APR: 25%
- Compounds per year: 365 (daily)
- Days invested: 180 (about half a year)
- Token price change: -10%
The calculator will:
- Convert APR to decimal: r = 0.25.
- Convert time to years: t = 180 / 365 ≈ 0.493.
- Apply daily compounding for about 0.493 years.
- Apply a -10% token price move to the compounded amount.
You may find that even with a 25% APR, the final value is only slightly above or even below your initial $5,000, depending on how long you stay in the position. This illustrates how price risk and yield interact.
Comparison of example scenarios
The table below shows simplified, hypothetical outcomes using the same initial investment and time period, with different yield and price profiles. Numbers are rounded and for illustration only.
| Scenario | Asset type | APR | Compounding | Token price change | Approx. final value on $5,000 after 180 days |
|---|---|---|---|---|---|
| Scenario A | Stablecoin pool | 12% | Daily | 0% | About $5,300 |
| Scenario B | Volatile token | 60% | Daily | -35% | About $4,200 |
| Scenario C | Volatile token | 25% | No compounding | +15% | About $5,900 |
Scenario A shows how modest APR on a stable asset can lead to relatively predictable, incremental gains. Scenario B highlights that even a very high APR cannot always compensate for a severe price drop. Scenario C demonstrates that a moderate APR plus positive price movement can sometimes outperform steady stablecoin yields.
Assumptions and limitations
This yield farming return calculator makes several simplifying assumptions. Real DeFi strategies are more complex. In particular, the tool assumes that:
- APR stays constant for the entire period. In practice, reward rates often change as liquidity and trading volume shift.
- Compounding occurs at a fixed frequency and reinvestment is instantaneous and free. Actual strategies may compound irregularly and incur transaction costs.
- Token price change is applied as a single overall percentage from start to finish, not as a volatile path over time.
- No gas fees, slippage, or performance fees are included. These can materially reduce your net return.
- No impermanent loss is modeled for liquidity provider positions. If you provide liquidity in a two-sided pool, your real outcome may be higher or lower than this estimate.
- No taxes are considered. Your after-tax return can be very different depending on your jurisdiction.
Use the outputs as an educational estimate and a way to compare scenarios, not as a guarantee of profit.
Risks and disclaimers for DeFi yield farming
Farming yields in DeFi carries significant risks beyond simple price volatility. Before allocating capital, consider that:
- Smart contract risk: Bugs or exploits in protocol code can lead to partial or total loss of funds.
- Impermanent loss: For AMM liquidity positions, price divergence between paired assets can reduce your net value compared with simply holding.
- Stablecoin and counterparty risk: Stablecoins can depeg, and protocol treasuries or counterparties can become insolvent.
- Governance and regulatory risk: Protocol parameters may change, and regulatory developments can impact access or operations.
Nothing on this page is financial, investment, or legal advice. Always do your own research and consider speaking to a qualified professional before committing funds.
FAQ
How accurate are these yield farming estimates?
The calculator is accurate for the specific math it applies, but future APRs and token prices are unknown. Treat results as what-if scenarios based on your assumptions, not predictions.
What is the difference between APR and APY in DeFi?
APR is the simple annual rate without compounding. APY (annual percentage yield) includes the effect of reinvesting rewards. For a given APR, higher compounding frequency leads to a higher APY. This tool lets you approximate APY by choosing a compounding frequency.
Why do my real returns differ from what this tool shows?
Live protocols face changing reward rates, variable token prices, gas costs, slippage, performance fees, and different compounding schedules. Any of these can push your real-world results above or below the simplified estimate shown here.
Related tools and further reading
If you want to explore other perspectives on crypto returns, you may also find a staking rewards calculator, an APY vs APR comparison tool, or a basic DeFi overview guide helpful. Using several tools together can give a more complete view of your potential risks and returns.
How Yield Farming Works
Decentralized finance, often abbreviated as DeFi, represents a rapidly evolving ecosystem of financial protocols built on public blockchains. Yield farming is one of the most popular activities in this space. It involves depositing crypto assets into smart contracts that facilitate lending, liquidity provision, or other services. In exchange for supplying capital, participants earn rewards, typically in the form of interest payments, trading fees, or governance tokens. While the concept of interest is familiar, the decentralized nature of these platforms means that yields can vary widely and may change dynamically as liquidity levels fluctuate. Investors therefore often seek tools that allow them to project potential returns under different scenarios. This calculator attempts to fill that gap by letting you input an initial investment, an annual percentage rate (APR), how often rewards are compounded, the number of days the capital remains staked, and anticipated token price movement. The output provides an estimate of the final value and overall return, giving both newcomers and experienced farmers a quick reality check before committing funds.
Compounding is central to many DeFi strategies. When rewards are periodically harvested and re-deposited, they begin earning returns themselves, causing growth to accelerate over time. If the APR is quoted as a simple rate, the effective annual yield is computed using the familiar compounding formula
where is the principal, the APR expressed as a decimal, and the number of compounding periods per year. In practice, decentralized exchanges and lending protocols may allow compounding as frequently as every block, but daily, weekly, or monthly reinvestment intervals are more realistic for retail users. By entering the desired compounding frequency, this calculator converts the APR into an effective yield over the specified time period.
Example Compounding Frequencies
| Frequency | n (per year) |
|---|---|
| Daily | 365 |
| Weekly | 52 |
| Monthly | 12 |
| Quarterly | 4 |
| Annually | 1 |
Token price volatility adds another layer of complexity. Many yield farmers receive rewards in the platform's native token. If the token appreciates, the real-world value of the yield can outpace nominal percentages. Conversely, if the token loses value, the effective return can be significantly lower than the APR suggests. The price change field in this calculator lets you apply a percentage adjustment to account for expected appreciation or depreciation over the farming period. For instance, a 20% token price drop would be entered as -20, while a 50% gain would be entered as 50.
Although yield farming can be lucrative, it carries unique risks. Smart contract vulnerabilities, oracle failures, governance attacks, and impermanent loss in automated market makers can all erode profits or even lead to full loss of principal. The outsized returns advertised by some protocols should therefore be weighed against potential hazards. A thorough risk assessment involves evaluating the protocol's security audits, the liquidity of the reward token, and the broader market conditions. Moreover, taxes on realized gains or received tokens can significantly reduce net profits. This calculator does not account for taxes or fees, but practitioners should factor them into decision making.
If we let denote the time horizon in days, the number of compounding periods actually applied becomes . The future value of the investment before token price changes is then . After adjusting for price movement , expressed as a decimal, the final estimation becomes . This two-step approach isolates the yield generated by the protocol from speculative token appreciation, helping farmers understand how much of their gains come from each component.
Consider a scenario where an investor supplies $5,000 to a liquidity pool yielding 40% APR, compounds weekly, and plans to stay invested for 90 days. Suppose the reward token is anticipated to rise 10% in value. Inputting these values into the calculator reveals a final balance around $5,626. The return attributable purely to compounding would be approximately 10.2%, while the token price bump contributes the remaining growth. This type of back-of-the-envelope projection is invaluable when comparing opportunities across different platforms or allocating funds between DeFi and traditional markets.
The landscape of decentralized finance continues to evolve rapidly. New mechanisms like liquidity mining, staking derivatives, and auto-compounding vaults are introduced frequently. Keeping up with these innovations requires not only technical knowledge but also practical tools that distill complex math into actionable insights. The sheer volume of protocols and reward structures means that even experienced investors can benefit from a simple calculator that verifies their assumptions. By relying on client-side JavaScript, this page avoids sending any of your input data across the network, preserving privacy while allowing repeated use even when offline.
Beyond individual profit, yield farming has broader implications for the crypto ecosystem. Liquidity provision stabilizes decentralized exchanges, lending markets enable capital efficiency, and governance tokens distribute control to users. Yet, the sustainability of high yields is uncertain. Many rewards are subsidized by token emissions that may dilute value over time. When evaluating opportunities, it's therefore prudent to look beyond headline APRs and consider long-term tokenomics. This calculator, with its inclusion of token price adjustment, encourages such a holistic perspective.
Ultimately, the best defense against miscalculations is continuous learning. Dive into protocol documentation, read third-party audits, monitor community channels, and test strategies with small amounts before scaling up. Use the outputs from this calculator as a starting point rather than definitive forecasts. Combine them with scenario planning that contemplates worst-case outcomes. In doing so, you'll be better positioned to navigate the volatile yet fascinating world of decentralized finance.