Every investment that is made, there must be the possibility of making some profit. Unprofitable investments are sure to produce losing money. And, a poorly prepared investor will quickly realize that making accurate calculations is as crucial to successful investment as using the correct strategies.

Earning steady profits from cryptocurrency investments is not straightforward. The current market fluctuation is a guarantee that investors can never be 100% certain about the results of their the investments. Even with the most sophisticated strategies, it is easy to fall afoul of the most basic principles.

The process of calculating your profit bitcoin and losses is an excellent option to increase your portfolio. It is also a great way to take note of the things that went wrong and how you can be improved in the future.

How can you calculate crypto profits?

There are many ways crypto investors can make money. As a miner on blockchains that use proof-of-work you could earn money by providing computing power for the network, generating power for the blockchain, and validating transactions.

Furthermore, long-term investments can yield substantial profits. Also, crypto traders who are able to study charts and consistently execute profit-making trades are in the right track. Hedging is a different method to make crypto profits.

It is possible to use basic arithmetic strategies to calculate the crypto gains. There are profit app download of factors you should consider prior to making calculations of profits and losses.

In this article we’ll discuss these critical factors and the best ways to note the margins of loss and profit. Continue reading to learn more.

Simple Math

You don’t need complicated formulas or charts in order to calculate your cryptoprofit. The basic profit-loss formula can be used in simple math. It is said that profit equals buying price minus selling price.

Here are a few of the side-along determinant factors:

Prices of gas

Developers and users of Ethereum who use the Ethereum network to develop Dapps is a cost of token gas.

The Ethereum blockchain is among the most popular decentralized platforms that utilizes smart contracts. It hosts many tokens and ecosystems. The investment in Ethereum requires paying gas fees.

So, if you happen to be investing in ERC-20 tokens it is expected to be charged gas costs. The fees you pay should be considered against the investment to know precisely the amount you’re losing per investment.

Exchange charges

You should also be aware of transaction charges when you trade on various exchange platforms. Coinbase has different fees for each user tier. It is crucial to know the tier you’re on so that you can tailor your investment accordingly to receive discounts or to avoid massive losses.

Costs of investment

In addition to exchange and gas fees, other investment fees might also be applicable. Many structures, such as apps that are Defi, may come with different charges. There are huge losses when you don’t thoroughly investigate the fees associated with any new investment plan.

To calculate the crypto profit, you will need to use a base currency such as the Euro or the US dollar.

Here’s an example:

An investor purchases crypto assets worth $20,000 and sells them off for $60,000. The formula used is arithmetic to calculate the profit, which is the price at which you sell less the price at which they were purchased. In this instance the investor earned an income of $40,000.

But, the profit margin calculated in the previous paragraph is only a gross estimate. You will need to subtract other depreciations including any transaction-related fees to calculate the net profits.

These fees for trading are applicable to transactions made across various platforms that involve swap trades, liquidity and other types of transactions.

Any additional charges must be excluded in order to determine the net profit. This means that the net profit is equal to total profit minus depreciations and any additional transaction charges.

Profit Calculators

A crypto profit calculator is very useful for traders looking to keep track of their cryptocurrency portfolio.

They are easy to use and permit investors to estimate their profits and loss percentages. Platforms such as CoinStats are useful for investors who are constantly trying to stay on top of their investment performance.

These calculators may be interesting to you:

Sabe Calculator

This calculator is extremely comprehensive and has additional components that will help you calculate your profit in a better way. This calculator includes tutorials, classes and tools to help you comprehend.

Easy Bitcoin Calculator

It is also a great tool, with many of the previous functions that allow users to estimate the crypto’s losses and gains in a matter of minutes.

Conclusion

It’s great to buy crypto at low costs and then sell them once they go up in value. But, other aspects determine whether you’ll be making profits or suffering a wrecking loss.

The best method to stay on top of the game is to keep abreast of the best and latest developments and technologies, while recognizing that the blockchain industry is still very much in its beta stages.