APR vs APY

APR and APY both describe a yield over one year, but they are not the same number. APR, the annual percentage rate, is the simple rate with no compounding assumed. APY, the annual percentage yield, assumes rewards are reinvested at a set frequency, so for the same underlying rate it is always the larger figure. DeFi dashboards mix the two freely, and quoted rates are usually variable snapshots that assume today's conditions hold for a full year, which makes them projections rather than commitments. Lending rates move with pool utilisation, and farming rates depend on the market price of the reward token. Reading which convention is used, and which token pays the yield, matters.