Bitcoin Profit Calculator
How To Use Our Bitcoin Profit Calculator Tool
Using our profit calculator is quick and simple allowing you to see how much profit (or loss) you might have at any particular selling price. While calculating profit isn’t too complicated, our tool can help those who are just starting out understand the process better as well as speed things up for more experienced traders.
- Choose your fiat currency
- In the “Buy Price” field, enter the fair market value of your bitcoin when you bought it
- In the “Sell Price” field, enter the fair market value of your bitcoin when you sold it
- In the “Investment” field, enter the amount (in fiat) you invested
- Enter in any investment fees or exit fees you were charged such as trading fees, transaction fees, or other exchange related fees
Once you’ve entered in all your information, the calculator will display your total profit or loss as well as show you some other helpful information.
How To Buy Cryptocurrency
Interested in buying crypto? We can help. By comparing top online crypto exchanges side-by-side with our expert guidance, you can find the smartest and most secure way to invest responsibly in your future.
To get started, check out our Crypto Exchanges page which lists all our top rated exchanges, our dedicated crypto exchange comparison tool as well all the latest exchange reviews, how to’s, guides and more.
How Do You Calculate Crypto Profit?
In order to calculate profit for your crypto investment you need a few bits of information. This includes:
- Disposal Value: The fair market value of your bitcoin when you dispose/sell it
- Disposal Fees: The trading fees or any other exit fee you would pay to dispose of your bitcoin
- Purchase Value: The fair market value of your bitcoin when you first acquired/bought it
- Purchase Fees: The trading fees or any other investment fee you paid to purchase your bitcoin
Once you have this information you can calculate your profit (or loss) using the below equation:
Gain/Loss = (Disposal Value – Disposal Fee) – (Purchase Value + Purchase Fees)
As an example, say you bought 1 bitcoin for $10,000 and paid $100 in trading fees. Later on, you sell this 1 bitcoin for $30,000 and paid $300 in trading fees. Your profit is calculated as:
Profit = ($30,000 – $300) – ($10,000 + $100) = $29,700 – $10,100 = $19,600
How Do You Calculate Crypto Taxes?
How you pay taxes on your bitcoin profits will obviously differ from country to country. In the United States, bitcoin is treated just like most other investments and is subject to both income tax (when you earn bitcoin) and capital gains taxes (when you sell or dispose of your bitcoin)
A critical thing to remember when dealing with taxes is to always keep detailed records of what you’re investing in. For crypto, it’s also common for countries to classify the trading of one crypto for another as “disposal” of the asset, for example, swapping Ethereum for Bitcoin.
This means you need to keep detailed records of things like:
- Date of investment
- What asset you’re buying
- What price you bought it at
- What fees you paid to buy the investment
- Details of who you bought the investment from such as name or bitcoin address
- Date of disposal of the investment
- What price you disposed of the investment at
- What fees you paid to dispose of the investment
- Details of who you sold the investment too such as name or bitcoin address
Unfortunately calculating crypto taxes is not a straight forward process as how you calculate it depends on a number of different things. For example if you earn crypto it’s taxed differently to if you make a capital gain on crypto you’ve invested in.
For more detailed tax information for those in the United States, CoinLedger has an excellent and simple guide that explains many of the most common use cases. If you’ve made large profits or are dealing with a lot of buying and selling, we’d also heavily recommend seeing a fully qualified tax accountant as they will more than likely save you more than they charge.
Should I Reinvest My Crypto Profits?
Whether you reinvest your profits is a very personal decision that can be affected by many different things. For instance, your portfolio may be better balanced if you reinvest or you could experience less short term volatility of you sell. As such, it’s always best to speak with a certified financial planner first as they’ll have access to your personal financial details and be able to best advise you.
If you do choose to reinvest your profits, there can be important tax considerations. For example, if you’ve made a profit on one cryptocurrency and want to shift it into another, this usually counts as “disposing your asset” as you’re selling it to buy another cryptocurrency.
As a result of this swap (selling), you will be expected to pay capital gains taxes on the difference between the buy and sell price in most countries. So make sure you either have spare cash on hand to pay this, or keep some of the profits to pay the total amount of taxes.
Historical Bitcoin Prices
| Year | Start | End | Return |
|---|---|---|---|
| 2009 | $0 | $0 | 0% |
| 2010 | $0.0025 | $0.10 | 3,900% |
| 2011 | $1 | $30 | 2,900% |
| 2012 | $5.31 | $14 | 164% |
| 2013 | $20 | $755 | 3,675% |
| 2014 | $767 | $317 | -59% |
| 2015 | $314 | $431 | 37% |
| 2016 | $434 | $960 | 121% |
| 2017 | $998 | $14,839 | 1,387% |
| 2018 | $14,093 | $3,809 | -73% |
| 2019 | $3,692 | $7,240 | 96% |
| 2020 | $7,244 | $28,837 | 298% |
| 2021 | $28,665 | $48,022 | 67% |
| 2022 | $48,082 | $16,540 | -66% |
| 2023 | $16,541 | $42,208 | 155% |
| 2024 | $42,208 |
Should You Invest In Bitcoin Or Other Cryptocurrencies?
A common trend among investors is to not just invest in Bitcoin, but other alternative cryptocurrencies too, often under the guise of diversifying. This is thought to be a “sensible idea” due to many people not properly understanding Bitcoin or believing in any of the numerous Bitcoin Myths that are out there.
There’s a big difference between Bitcoin and all other cryptocurrencies which isn’t entirely immediate to most beginners, even those that have considerable investing experience.
In reality you have Bitcoin and then the descriptive word Cryptocurrency. There are many thousands of cryptocurrencies out there under the general category of “cryptocurrency” and Bitcoin is just one example. Ethereum is also another type of Cryptocurrency.
Bitcoin is the original monetary network that has a number of absolutely critical aspects to it that elevates it orders of magnitude above all others. Not a single other cryptocurrency out there has its network effect, its creation conditions, its size, its branding, its recognition, its decentralization or its security. All things that underpin anything that is trying to be a real money.
It’s like comparing a Ferrari 296 GTB… with a tiny plastic Hot Wheels car.
There Is No Second Best
As Bitcoin was the first cryptocurrency, many people who don’t know much about the topic (eg talking heads on TV) use the two terms interchangeably which can lead to a lot of confusion. They also think that Bitcoin and these many other thousands of cryptocurrencies (or altcoins as they’re known) are “similar” or comparable when in fact they are anything but.
Bitcoin has had no outside capital investment and is still by far the biggest. Crypto has had vested interests pour billions into companies hoping to create the next Google or Amazon that they can then turn into cash cows all while using unsuspecting retail investors as Exit Liquidity.
Bitcoin has stood strong for 15+ years now. Crypto has had coin after coin after coin crash and go to 0. Here are the top 2,412 coins versus Bitcoin over a multi-year period. 97%+ of crypto coins suffered a >10x loss. This is also pre-2020. These are also the top coins, there are 15,000+ other worse ones.
Bitcoin is actually decentralized with over 15,000+ nodes world wide. Crypto isn’t and is in many cases, beholden to regulatory capture already. Below is an example of Bitcoins decentralization in action. Hard proof, not promises.
Bitcoin is secured by the strongest computer network on the planet in the form of Bitcoin Miners with 500+ TH/s of hash rate. Even the top crypto is orders of magnitude less secure and thus, at more risk from attacks.
Bitcoin is used by hundreds of millions of people world wide for savings, fighting oppression, growing businesses, buying groceries, coffee, building nations and more. Crypto continues to devolve into a sea of degenerate gambling, self printed tokens, bank runs, insolvencies, ponzinomics and dogecoin. The SEC has also ruled that virtually all crypto assets (except Bitcoin) are securities.
Bitcoin has a near perfect up time at 99.988% since its inception in 2009. Since 2013 it’s up time is a perfect 100%. Multi trillion dollar global behemoths like Google and Amazon can’t even beat that.
Crypto keeps getting hacked, pausing withdraws, going down and restricting its users from withdrawing staked funds.
Will I be able to use my funds while I’m staking ETH?
Coinbase
For now, you won’t be able to trade, send, or sell the amount you have staked.
The void between Bitcoin and all other “crypto” coins is as big as the void between galaxies and should be beyond obvious to anyone that looks even remotely closely.
Altcoins are a melting pot of scams, SEC violations, unregistered securities, fraud and at best, a fake “decentralized” version of what we already have with centralized banks and fiat currencies that censor and steal for the powerful elite.
There is Bitcoin and literally everything else.
It is because of this that we recommend investors only focus on Bitcoin, not other cryptocurrencies.
FAQ
When Should You Take Profits In Crypto?
To know when the best time to take profits in crypto investments is, you need to know the precise highs and lows of the market before they happen. While things like the Bitcoin Rainbow Chart try and help with this, they are all ultimately just a guess. The higher the profit you aim for, the higher your risk will be and predicting the volatile nature of crypto is extremely difficult. If you’re thinking about selling your bitcoin, you should speak with a financial advisor.
How Much Would $500 In Bitcoin Be Worth Today?
To calculate how much a certain fiat amount of Bitcoin is worth today, you need to know what the exchange rate was back when the $500 purchase was made. For example, if the exchange rate was 1 bitcoin = $20,000 USD, then $500 would have bought you $500 / $20,000 = 0.025 BTC. Now all you need to do is multiply that 0.025 BTC by the current value bitcoin is trading at to find out how much it’d be worth today.
Does The IRS Tax Bitcoin Profits?
Yes. While there are a few transactions where the IRS doesn’t tax profits, such as transferring funds you own in one wallet to another wallet you also own, in most cases like selling bitcoin for fiat or even swapping bitcoin for another cryptocurrency, the IRS requires you to report your crypto gains and pay taxes on them.
