Crypto Profit & ROI Calculator
Calculate your potential gains and losses across any cryptocurrency.
How to Calculate Cryptocurrency Profit
In the volatile world of digital assets, understanding your exact profit or loss is essential for sound financial management. This crypto profit calculator helps you determine the outcome of a trade by factoring in purchase price, exit price, and exchange fees.
The Formula for Crypto ROI
Calculating your profit isn't as simple as subtracting the buy price from the sell price. You must account for the number of coins held and the transaction fees charged by exchanges. The basic logic follows these steps:
- Step 1: Determine the quantity of coins purchased: (Investment / Purchase Price).
- Step 2: Subtract the initial trading fee from your starting capital.
- Step 3: Calculate the gross sale value: (Quantity × Selling Price).
- Step 4: Subtract the exit fee from the gross sale value.
- Step 5: Net Profit = Final Exit Value – Initial Investment.
Real-World Example
Imagine you invest $5,000 in Bitcoin when the price is $25,000. Your exchange charges a 0.2% fee. Later, you sell when Bitcoin hits $35,000, again paying a 0.2% fee.
In this scenario, you would purchase 0.2 BTC (minus fees). After selling at the higher price and deducting the exit fee, your net profit would be approximately $1,970, representing a 39.4% ROI.
Understanding Trading Fees
Fees are the silent profit killer in crypto trading. Most centralized exchanges (CEX) like Binance or Coinbase charge "Maker" and "Taker" fees. While 0.1% to 0.5% may seem small, these costs apply both when you enter and exit a position. High-frequency traders must be particularly careful, as multiple trades can quickly erode total capital if the profit margins are thin.
The Importance of ROI
Return on Investment (ROI) is a percentage that expresses the efficiency of your investment. A positive ROI indicates a gain, while a negative ROI indicates a loss. Comparing the ROI of various assets (e.g., Bitcoin vs. Ethereum) allows you to see which investment performed better relative to the amount of risk and capital deployed.