QuantumPools · Deep diveCompounding

LP education · growing your fees

Compounding fees: how much it really adds

“Should I put my fees back in, and how much extra does compounding really make?” A little at first, more with time.

The short version

Same $1,000, an illustrative 20% a year in fees: putting them back in monthly adds $13.89 in year one.

Paid out
$1,170.00
fees to your wallet
Put back monthly
$1,183.89
fees earn fees
Compounding added
+$13.89
in one year
Value after a year = deposit × (1 + g ÷ n)ⁿ g = yearly fee rate you put back: 17% here, after QuantumPools' 15% cut. n = times a year fees go back in. Key variable: g.

Illustrative, not a promise. The 15% comes from collected fees, never your deposit.

1 · The picture

Two jars, one year

Paid-out fees pile up in a straight line. Fees put back in earn fees of their own.

Two jars over 12 months. Paid out: fees of $170.00 go to your wallet, $1,170.00 in all. Put back in: fees of $183.89 stay inside the position, $1,183.89 in all, including $13.89 extra from fees earned on fees. Paid out Put back in Month 12 $1,170.00 $170.00 fees out $1,183.89 $183.89 fees in +$13.89 extra
Illustrative 20% rate · not this pool's
Value over 12 months on $1,000, illustrative 20% rate. Paid out rises in a straight line to $1,170.00. Put back in monthly curves up to $1,183.89, $13.89 higher. Use the arrow keys to step through months.
Compounding helps, slowly: the curve barely leaves the line in year one.
Table view
MonthPut back inPaid out
0$1,000.00$1,000.00
3$1,043.10$1,042.50
6$1,088.07$1,085.00
9$1,134.97$1,127.50
12$1,183.89$1,170.00

Paid out: $1,000 × 17% = $170.00 a year. Put back in: each month × (1 + 0.17 ÷ 12).

2 · How often

How often barely matters

Quarterly adds $11.15 in a year, monthly $13.89, daily $15.26. Even nonstop compounding tops out at $15.30.

Extra from compounding in one year by how often fees go back in: quarterly $11.15, monthly $13.89, weekly $14.98, daily $15.26. The nonstop ceiling is $15.30.
After monthly, each step adds about a dollar or less, and each Compound press costs you gas.
Table view
How oftenPer yearAfter a yearExtra
Quarterly4$1,181.15+$11.15
Monthly12$1,183.89+$13.89
Weekly52$1,184.98+$14.98
Daily365$1,185.26+$15.26
Nonstop (ceiling)∞$1,185.30+$15.30

3 · The key variable

The rate matters most

In one year, compounding adds $0.84 at a 5% rate, $13.89 at 20% and $93.38 at 50%. Bigger rates snowball faster.

20% → +$13.8917.00% after the 15%
Extra from compounding in one year, monthly with all fees back in, against the yearly fee rate before the 15%. The curve bends upward: $0.84 at 5%, $13.89 at 20%, $93.38 at 50% and $137.83 at 60%.
The rate, not the frequency, makes compounding matter. $1,000, monthly, all fees back in, one year.
Table view
Rate beforeAfter the 15%Extra in a year
5%4.25%+$0.84
20%17.00%+$13.89
50%42.50%+$93.38
60%51.00%+$137.83

4 · Time

Time makes it real

Same example, left working for years. The extra snowballs, if the rate and prices hold, and they won't exactly.

1 year
+$13.89
extra
3 years
+$149.34
extra
5 years
+$475.73
extra

steady-rate assumption · illustrative, not a promise

5 · Your fee setting

Your fee setting decides how much goes back

The default fee setting, Half in, half out, adds +$3.35 in year one on the $1,000 example. Only the token your new range holds can go back in, so even “all” is about half your fees. How the fee setting works → Configuration

Extra in year one by fee setting · $1,000, illustrative 20%, monthly snuggles

Auto-compound all adds $6.78, Half in, half out adds $3.35, Send to wallet adds $0.00. Putting every fee back in would add $13.89.

The rest isn't lost: it lands in your wallet as income.

Assumes fees split evenly between the tokens. The 15% is taken once. Between snuggles, only a Compound press puts fees back. Illustrative, not a promise.

6 · Try it

Try your own numbers

Pick a rate, how much goes back and how often. See the extra.

Share of fees put back
How often fees go back in per year (at a snuggle or when you press Compound)
Paid out only
$1,170.00
17.00% after the 15%
Putting back
$1,183.89
position $1,183.89 + wallet $0.00
Extra from compounding
+$13.89
1 year, 12 times a year
Illustrative, not a promise

Gas for your own Compound presses isn't counted.

Honest limits

Great for setting expectations. Not a forecast.

Useful for

  • Setting expectations for what compounding adds.
  • Choosing a fee setting on purpose.
  • Seeing that rate and time beat frequency.

Not for

  • Forecasting. Real fee rates change, and days out of range earn nothing.
  • Risk-free growth. Fees put back carry price risk and impermanent loss like the rest of your position.
  • Pressing often on a small position. Gas can eat the extra.

Where fees fit in your result: Up or down? Your result in three parts.

What to do with this

Compounding is a slow helper. Your fees and time do the heavy lifting.

Small position? Skip extra Compound presses: gas can eat the extra. Then give it time.

Pick your fee setting → Configuration

Educational content, not financial advice. Providing liquidity can lose money; nothing here promises returns.