Reading a vault APY: base yield, incentives, and the part that expires

A vault APY is a sum of things that behave differently. One part is cash flow from borrowers, one part is a token somebody is paying you with, one part is a promise with no price. Adding the three into one number and comparing that number to a Treasury bill is the most common mistake in the category.

The headline is a sum, not a rate

Pull apart any vault page quoting a double-digit APY and three legs usually fall out. A base yield paid in the deposited asset, an incentive paid in a governance token, and a points programme that pays in nothing yet.

Only the first is a rate. The second is a transfer of a volatile asset, sized at today’s price. The third is an option. The arithmetic is addition. The economics is not, because the legs differ in duration, failure mode, and payer.

The incentive leg is paid in the asset you are underwriting

Take a vault quoting a base yield plus a token reward. The reward is quoted at the token’s current price and paid over a fixed programme window.

Two things change the moment you deposit. The reward is denominated in a token you now hold, so you have taken a long position in the issuer’s governance asset on top of your exposure to the vault. And the quoted value of that reward falls if the token falls, while the number of tokens you receive does not rise to compensate.

Selling as it arrives is the obvious answer and it adds a second cost. The token is usually thin relative to the programme’s size, and your clip is one in a stream of sellers on the same schedule. The realised value of an incentive sits below the quoted value by the slippage of the whole programme.

Points are not a rate

Points are the least yield-like leg. A point balance is an unpriced claim on a token that may or may not exist, distributed by a formula that can change, at a valuation nobody has set.

None of that is necessarily dishonest. It is simply not a rate, and a column beside rates makes it comparable to things that are. The right treatment is an option: some probability of some value at some date.

There is a structural point about who pays. An incentive programme is a customer acquisition cost settled in equity, and budgets end. The base yield does not, because it comes from a borrower who is still paying.

Realised yield is the only number that compounds

The number that compounds is what lands in your wallet, in the asset you intend to keep, after every cost between the vault’s gross return and your balance.

That means subtracting management and performance fees, the cost of entry and exit, slippage on converting a non-native reward, and the gas or bridging to move in and out.

The same discipline applies to the fee and rate pages themselves, which is why we read them as trailing evidence rather than forward guidance (fee pages change monthly).

Credit risk is not a spread

Maple’s 5.20% and Plume’s nOPAL at 10.73%, both in RWA.xyz’s October 2026 readings, are not risk-free rates. They are credit spreads presented as yields.

The reference point is the tokenised Treasury complex at 3.60% to 3.61% annualised on a seven-day basis on 7 October 2026. Against that, 5.20% is roughly 1.6 points of compensation for lending to private borrowers, and 10.73% is more than 7 points. Private credit was about $8 billion of the on-chain RWA book in October 2026, and it is a market where a borrower can default.

A 10.73% headline on a private credit vault is not a high-yield savings account. It is the mean of a distribution that includes a loss, and the loss does not appear in the APY column. Yield paid in issuance deserves the same scepticism (staking yield is not income).

What to do next

Rebuild the number before comparing it. Treat the base yield as the only rate, discount the incentive for the slippage of the whole programme, and carry points at zero until something prices them.

Verdict

A vault APY is a marketing number assembled from three legs with different durations. The base yield is a rate, the incentive is a position, and the points are an option. Only the first compounds on its own, and only the net of all three is yours.

Compare credit spreads with credit spreads. Maple at 5.20% and nOPAL at 10.73% belong beside a corporate bond ladder, not beside a T-bill. The gap to a tokenised Treasury at 3.60% to 3.61% is the price of that distinction.