Calculating My Interest
Interest Earnings Calculation
At Kasu, interest is accrued and auto-compounded every weekly epoch and updated into your balance at the beginning of every new epoch. This means your interest earnings are not distributed or claimed manually — instead, they’re automatically added to your principal, allowing your balance to grow over time through compounding.
It is important to understand that all Lending Requests must be submitted prior to the Clearing Period (final 48 hours of each weekly epoch) to be considered for the next weekly epoch. This will be determined by the Credit Originator's need for funding, which is determined during each weekly Clearing Period:
If your Lending Request is submitted before the Clearing Period cut-off (Tuesday 6 AM UTC) – and it is accepted – you’ll start earning from the beginning of the next epoch.
If your Lending Request is submitted after the cut-off, it will be carried over to the following Clearing Period – and if accepted – interest will start accruing from that following weekly epoch.
Interest does not start accruing until the beginning of the next weekly epoch. If your Lending Request is not accepted, it will be rejected (funds will be returned).
Weekly Gross Interest Formula
To convert the Annual Percentage Yield (APY) into a weekly interest rate, Kasu uses the following formula:
((1 + APY)^(1 / 52.17857)) - 1
Where:
APYis expressed as a decimal (e.g. 16% APY = 0.16)52.17857represents the number of weeks in a year, based on 365.25 days ÷ 7
💡 Why 365.25 days, not 365? Every four years, we add an extra day (February 29) to the calendar — a leap year — to stay aligned with the Earth’s orbit. Over time, this averages out to 365.25 days per year, which equals 52.17857 weeks.
Using this more precise figure ensures your compounded interest is calculated as accurately as possible — especially over longer timeframes.
Common Mistake: APR vs APY
Some users mistakenly calculate weekly interest using:
LoanBalance × (APY ÷ 52); or,
LoanBalance × (APY ÷ 365 × 7)
This only works if you're dealing with APR (simple interest), not APY, which assumes compound interest. Since Kasu uses APY, a compounding formula like the one above is required to calculate your true weekly earnings.
Net Interest (After Platform Fee)
Kasu applies a 10% platform fee to your weekly gross interest (half of which is shared with Lenders who are also KASU token lockers, as they earn Protocol Fees) . The remaining 90% is accrued and auto-compounded into your loan:
(((1 + APY)^(1 / 52.17857)) - 1) × 90%
🔍 Example — 16% APY
Weekly Gross Interest:
((1 + 0.16)^(1 / 52.17857)) - 1 ≈ 0.00289(≈ 0.289%)Weekly Net Interest:
0.00289 × 90% ≈ 0.00260(≈ 0.260%)
Assume your starting, initial loan balance is $10,000:
By the end of the first weekly epoch, $26 interest is accrued onto your balance. Your balance then becomes $10,026.00 and is reflected in your portfolio at the start of the new epoch.
But, assuming no withdrawals, your weekly interest increases due to the effect of auto-compounding — with no action needed.
Here's how:
✅ After 52 epochs (1 year):
Weekly interest grew from $26 per epoch to $30.21 per epoch due to the effect of auto-compounding
Your balance grew from $10,000 → $11,698.21
You earned $1,698.21 in net interest
That’s exactly 16% APY, thanks to auto-compounding each week
Summary for Lenders
✅ Accrued and auto-compounded: Interest is automatically added to your balance at the end of each epoch
✅ APY reflects compounding: Don't divide APY by 52 or 365 — it will understate your actual return
✅ 365.25 days = 52.17857 weeks: Used to reflect leap years and keep compounding calculations precise
✅ Actual return may vary: If you withdraw early or frequently, your effective yield will be lower than the stated APY
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