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[source](https://www.guardiansavings.org/blog/2019/9/1/the-8th-wonder-of-the-world)

No it is not Niagara Falls or something of beauty depicted in nature but the magic of compound interest. if you are lucky enough to find out how it works and apply compounding to your investments you will see how powerful and magical compounding really is.

Compounding is when interest is accrued on your investment whether it is every minute like on Hive or daily, weekly, monthly or annually. Obviously the trick is to find an investment that rewards the APR earned more regularly than monthly or annually as the compounding needs this to perform it's magic. 

Hive is a brilliant example of how this works as we are fortunate enough to earn 3% annually which is paid out every minute. On an account that holds 100K Hive Power it is clear to see that growth is inevitable as that would equate to earning 8.2 Hive every single day for just having stake. This on a normal APR would equate to 3K Hive per annum but with compounding you would generate an extra 45 Hive. This doesn't sound like much, but over a period of just 5 years you would see an extra 1182 over and above the 15K (3 x 5).

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The other factor we need to throw into the equation is the stake we are continuously adding via curation and posting. This combined with the compounding effect drives the account growth into a money making machine that cannot be compared. The more active one is throughout the time period the bigger the growth expected.

This is why discarding the current value of the Hive token or any other token you are currently staking and compounding is irrelevant right now. Why stop the compound printing as you are earning the extras every single day. Just imagine where one could be in 5 years time if you were active every single day. My 5 years is up in march and will approximately be around the 86K HP if I remain active which I obviously will.

What we have learned with staking is the art of using the tools at our disposal like compounding as this is what is going to transform the over all values of what you can earn in the future. A Hive having the value of $5 would change the lives of so many people even if they didn't post every single day just by what they are earning via curation and the 3% APR.

Some of my other investments are earning 10 tokens per day which also doesn't sound like much until they are $2 or $3 each which by then hopefully that 10 per day would be 20 per day or more. This is all achievable when you stake in projects that have the ability to compound and why finding these gems is life changing.

Posted Using [LeoFinance <sup>Beta</sup>](https://leofinance.io/@cryptoandcoffee/compounding-is-the-future)