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# APY Calculation

The APY is calculated from the reward yield (a.k.a rebase rate) using the following equation:
$APY = (1+ rewardYield)^{1095}$
It raises to the power of 1095 because a rebase happens 3 times daily. Consider there are 365 days in a year, this would give a rebase frequency of 365 * 3 = 1095.
Reward yield is determined by the following equation:
$rewardYield = TOP_{distributed}/TOP_{totalStaked}$
The number of $TOP distributed to the staking contract is calculated from GG total supply using the following equation: $TOP_{distributed}= TOP_{totalsupply} * rewardRate$ ​Note that the reward rate is subject to change by the protocol. ## Price offset with Reward Accumulation Because of the power of compounding, your The APY is calculated from the reward yield (a.k.a rebase rate) using the following equation: $APY = (1+ rewardYield)^{1095}$ ## Price offset with Reward Accumulation Because of the power of compounding, your$TOP balance will rise dramatically over time, as seen above. Assume you purchase a $TOP for$400 today and the market determines that in one year, the intrinsic value of $TOP will be$20.
Assuming a daily compound interest rate of 2%, your balance would increase to around 1377 $TOP at the end of the year, which is worth approximately$27,540. That's a tidy profit of $23,540! You should have realized by now that you are paying a premium for$TOP now in return for a long-term advantage. As a result, you should have a long time horizon to allow your $TOP balance to grow exponentially and make this investment worthwhile. The performance of the collateral pool can be used to calculate the intrinsic value. For example, if the collateral pool can guarantee that each$TOP will be backed by 20 USDC, the intrinsic value will be 20 USDC.

## Do I have to unstake my $TOP or claim my rewards? When you stake$TOP via the $TOP DAO dapp, your staked$TOP balance will auto-compound on every epoch. Your rebase benefits are represented by the rise in balance. balance will rise dramatically over time, as seen above. Assume you purchase a $TOP for$400 today and the market determines that in one year, the intrinsic value of $TOP will be$20.
Assuming a daily compound interest rate of 2%, your balance would increase to around 1377 $TOP at the end of the year, which is worth approximately$27,540. That's a tidy profit of $23,540! You should have realized by now that you are paying a premium for$TOP now in return for a long-term advantage. As a result, you should have a long time horizon to allow your $TOP balance to grow exponentially and make this investment worthwhile. The performance of the collateral pool can be used to calculate the intrinsic value. For example, if the collateral pool can guarantee that each$TOP will be backed by 20 USDC, the intrinsic value will be 20 USDC.