Testing APY in real conditions: how to determine a sustainable reward for staking

(Investorideas.com Newswire) The issue of profitability in cryptocurrency today worries almost every investor. Some are looking for rapid growth through trading, while others prefer calmer strategies. More and more people are paying attention to staking - the ability to receive rewards simply for storing coins in the network. For many, this has become the answer to the question: how to earn passive income in crypto without risking daily fluctuations in the exchange rate.

But how do you know that the promised interest is real, and not just a pretty figure on the website? In the world of cryptocurrencies, the APY (annual percentage yield) indicator is often encountered. On paper, it looks tempting: 10%, 15%, and somewhere even 100% per year. However, in real conditions, these percentages can differ greatly. In order not to fall into a trap and really build a sustainable strategy, it is important to understand what is behind the numbers and how to correctly evaluate the profitability.

What is APY and where do the numbers come from

APY (Annual Percentage Yield) is an indicator of profitability for the year, taking into account compound interest. To put it simply, it shows how much you can earn in 12 months, provided that the received rewards are reinvested.

In practice, many confuse APY with a fixed rate. In a bank, you can see “deposit at 10% per annum” - this is a fixed percentage. In cryptocurrencies, the rate often changes because it depends on many factors: the number of network participants, the total volume of blocked coins, the rules of a particular blockchain, and even fluctuations in the price of a token. Therefore, the numbers indicated on the site should not be perceived as a guaranteed result, but as a guideline.

Why does the real income differ from the promised one

The situation is familiar to many: you see an attractive offer with a rate of 20% per annum, start staking, and after a few months, you realise that less is coming into the account. Why does this happen?

Firstly, APY is calculated based on the current network conditions, which can change. If the number of participants increases, the reward is divided among a larger number of stakers. Secondly, some projects deliberately inflate the numbers to attract new users. In reality, high income does not last long.

The third point is the fluctuations in the exchange rate of the coin itself. Even if you received the declared interest in tokens, in dollar terms, the result may be completely different. For example, the token has risen in price - the income in currency has increased. But if it has fallen in price, the final result may be more modest than expected.

How to check the stability of APY

The investor's task is not just to look at the numbers in the table, but to understand how real they are in the long term.

Here are a few things to pay attention to:

• Income history. If the project has been around for more than a year, you can study how the APY has changed over time. Stable indicators indicate that the system operates transparently.
• Platform reputation. Using trusted services reduces risk. For example, in Coindepo, you can track transparent terms for calculating rewards and be sure that the numbers are not “pulled out of thin air.”
• Distribution mechanism. You need to understand how the income is generated. If rewards come exclusively from the emission of new tokens, you should be careful: over time, such a model becomes unstable.
• Real network load. The more users actively participate in staking, the lower the chance of a sharp collapse in profitability.

Checking these factors helps to assess whether the promised APY is worth trusting and how sustainable it will be in the future.

Beginner mistakes when assessing APY

Many novice investors make the same mistakes. The most common is believing in too high interest rates. When a project promises 200-300% per annum, it is worth understanding: such figures cannot be long-term. Usually, this is a marketing ploy designed for the first participants.

Another mistake is ignoring the commission. Some platforms charge interest for withdrawal or delegation, and as a result, your real income is lower than expected. Coindepo has transparent conditions and no hidden commissions, but not all services are so honest.

And finally, many forget about exchange rate fluctuations. You can get your 10% in tokens, but if the coin has fallen in price by 30%, the real yield will be negative. Therefore, it is important to evaluate not only the interest but also the prospects of the cryptocurrency itself.

Practical example

Imagine you invested $1,000 in staking a token with a promised APY of 12%. According to calculations, in a year you should have about $1,120. But what happens in reality?

Let's say there are more participants in the network, and the actual income has decreased to 9%. In addition, the token price has fallen by 10%. As a result, you have income in tokens, but in dollar terms, it will not be $120, but about $80.

On the other hand, if the token has grown in price by 20% during this time, the final income may exceed initial expectations. This example clearly shows that APY is not a guarantee, but a guideline, and it should always be considered in a comprehensive manner.

The role of platforms in forming profitability

The platform through which you stake coins plays a huge role. Some services attract users with loud promises, but in the end, the income is less. Others, on the contrary, work transparently and honestly show real numbers.

Coindepo belongs to the second category. Here you can track the history of rewards, understand the mechanism of their accrual and assess the real potential. In addition, the platform provides an opportunity to diversify assets, which reduces risks. This is especially important for beginners: instead of trusting dubious projects, it is better to choose a service with a good reputation.

How to build a strategy

The right approach to staking is not a race for the highest numbers, but building a sustainable strategy. There are several steps: first, study the history of the project, then check the platform's reputation, and then distribute funds so as not to depend on one validator or one token.

For example, some assets can be placed on a proven platform like Coindepo, and some can be directed to riskier projects with a high APY. This balance allows you to both receive a stable income and not miss opportunities when new tokens grow.

Conclusion

APY is a useful indicator, but you need to take it with caution. The numbers on the site may be attractive, but only a real-life test shows how sustainable the income really is. To understand how to get passive income in cryptocurrency without losing your investment, it is important to analyse the history of profitability, choose reliable platforms and take into account the fluctuations in the token rate. Relying only on promises is risky.

The best option for most investors is to use services with transparent conditions. Coindepo is one such example. It allows you to safely check profitability, see real numbers and build a strategy that will bring results in the long term.

The main thing is to remember that stable income in cryptocurrency is not built on promises, but on real numbers, a careful approach and the ability to analyse. Then, staking will really become a source of stable and reliable income.