Understanding APY on USDC SuperFund

If you’ve deposited USDC into SuperFund and discovered that after a few days, the yield isn’t adding up according to your calculations. Here is a walkthrough thread of how interest/APY is accrued in simple terms.

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So how does the USDC SuperFund APY work?

SuperFund uses a “yield smearing” mechanism, a feature borrowed from the Euler Earn protocol. 

Here’s what that means:
When yield is earned by the vault, it isn’t paid out all at once. Instead, it's gradually distributed over a period of time (typically 7 days). 

This creates a smooth, stable return curve and protects against sudden rate spikes or dips.

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APY (Annual Percentage Yield) shows how much you could earn over a year, with compounding included. So when you see a vault offering 10% APY, that doesn’t mean you’ll earn 10% divided by 365 each day. Instead, it reflects the long-term, compounded growth you’d earn if you stayed in the vault over time.

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TL;DR

> APY is annualized and compounding, not daily.
> Early earnings are lower due to a 7-day yield smearing ramp-up.
> This protects stability and ensures fairness.
> You’ll see your personal APY rise and match the USDC SuperFund’s APY after a few days.