# Rewards Algorithm

**URL:** <https://forum.algorand.co/t/rewards-algorithm/4433>\
**Category:** General\
**Created:** [October 1, 2021, 7:00pm UTC](https://forum.algorand.co/t/rewards-algorithm/4433 "2021-10-01T19:00:57Z")\
**Posts on this page:** 1\
**Showing post:** 1

<div class="post-metadata">

**Author:** ![bhaney44](https://avatars.discourse-cdn.com/v4/letter/b/e8c25b/32.png) [@bhaney44](https://forum.algorand.co/u/bhaney44)\
**Post date:** [October 1, 2021, 7:00pm UTC](https://forum.algorand.co/t/rewards-algorithm/4433/1 "2021-10-01T19:00:57Z")

</div>

So, as I understand it, rewards accrue daily at a 6.00% APY rate on the principal balance in the account. However, rewards are not added to the account until it receives or sends an Algo. Once rewards are added, does the principal balance accruing 6.00% APY change? If so, this would suggest returns could be much higher than 6.00% because the rewards would compound daily as opposed to annually. Does anyone know where the source code is for the rewards algorithm on GitHub? Thanks!

---

_[View the full topic](https://forum.algorand.co/t/rewards-algorithm/4433)._