sUSDe Rewards Mechanism

Ethena calculates APY weekly as part of internal accounting when distributing APY to the StakingRewardsDistributor contract which then drips it into sUSDe.

The APY calculated by Ethena matches funding and rewards earned from backing assets earned on a given day to the backing assets on that day, assuming nothing is distributed to the reserve fund.

However, to prevent lumpy distributions which people can arbitrage, and because its not currently feasible for Ethena to distribute more frequently than weekly, sUSDe rewards are distributed the week after the period to which they relate, in multiple smaller payments throughout the week. In that period, the USDe supply can increase or decrease, as can the % of USDe supply staked.

This can cause distortions between the APY we publish, and a number that's just based on the most recent 8 hourly payment to sUSDe, as seen on some data aggregator sites.

Ethena's APY is also annualized with weekly compounding reflecting the compounding interval users actually experience.