# APYs & Incentives

When lending (supplying) an asset on Bonzo Finance, the asset is supplied into single-asset liquidity pool.  For example, the HBAR market consists of an HBAR liquidity pool, which everyone supplies into. Inversely, users borrowing an asset from Bonzo Finance borrow it from same single-asset liquidity pools lenders supplied into.

When supplying assets to Bonzo Finance, there are two types of rewards, a "Native APY" and a "Liquidity Incentives APY" (indicated by a ✨ icon in the dashboard, next to the native APY).

<figure><img src="/files/cTGGj8RkiyZLXUjfZAmc" alt=""><figcaption></figcaption></figure>

### 1. Native APY Rewards

Every asset supported by Bonzo Finance offers a native APY for supplying. Native APYs are:

* **Auto-compounding**: Supplied assets automatically earn compounding interest without any additional actions required.
* **Variable**: The APY fluctuates primarily based on the utilization ratio of each pool (how much of the pool is being actively borrowed relative to its total supply) and the [interest rate models](https://docs.bonzo.finance/bonzo-risk-framework/liquidity-risk/actual-rates-and-parameters) for each asset pool.
* **Real-time Accrual:** Interest accumulates continuously and is reflected in your balance.

### 2. Liquidity Incentive APY Rewards (✨)

Some assets supported by Bonzo Finance offer liquidity incentives, in the form of an additive APY, for both supplying and borrowing — these rewards must be claimed by the user manually. Liquidity incentive APYs are:

* **Bonus Rewards**: Indicated by a reward icon (✨) next to the base APY.
* **Claimed Manually**: Unlike the native APY, these rewards must be manually claimed by clicking the "Claim" button at the top of your "Supplied" and "Borrowed" boxes in the dashboard.
* **Consist of Multiple Asset Types**: Depending on the asset supplied or borrowed, you may receive rewards in different asset types, including HBAR, USDC, DOVU, KARATE, or others.


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