About our crypto interest calculator

The crypto staking calculator helps you work out:

How much money you’ll accrue over a period of time from interest
How compounding interest affects your savings over a long period of time
How to calculate the APY & compound interest for staking Cryptocurrency
The total potential profit over a period of time combining compound interest & the natural growth of Crypto

According to Albert Einstein, “compound interest is the eighth wonder of the world”. “He who understands it, earns it; he who doesn’t, pays it”, continued one of the greatest geniuses the world has ever seen.

Compound interest is a common financial tool on the stock market. Today, you’ll learn all about this tool and how to use it with your crypto investments. We’ll go through the most popular platforms that offer this service and carefully compare their rates.

Finally, we’ll tell you how our crypto compound interest calculator can help you better plan your crypto investment strategies.

Let’s get started!

Staking crypto and compound interest: A deeper look

If you want to manage your finances well and earn higher returns on savings and investments, you should look into the concept of compound interest.

Compound interest is basically the interest you get on existing interest. It’s earned and added on top of the money that you have previously earned on your simple interest. Over time, compounding can result in exponential growth of your account balance at an increasing rate. This is known as “the miracle of compound interest”.

Let’s imagine that you make an initial deposit of $100 to your savings account. Your deposit earns a 5% annual interest so, after one year, you will have $105. The following year, you earn 5% interest on your previous interest which brings your balance to $110.25, and so on.

This is an example of interest compounded annually, but there are also banks that do this semiannually or quarterly. The more frequent the compounding, the higher the gains. If you want to accrue compound interest at a higher rate, you should start saving early because the interest can grow exponentially after 10 or 20 years.

If you buy a $2 coffee every single day for a year that would cost you $730. If you decide to save that money and invest them into your savings account, with a 5% interest rate, you’ll have $931.69 in five years. Not bad at all, right?

Compounding Crypto Interest

Stock market investors aren’t the only ones who can benefit from compound interest. Thanks to the amazing trading volumes and crypto market cap in recent years, some online platforms have started to offer services that allow crypto investors to increase their crypto holdings.

For a long time, the main investment strategy of crypto investors was to hold onto their cryptocurrencies long-term, hoping their value climbs up exponentially in the future. They store crypto online in digital wallets provided by crypto exchanges or purchase hardware wallets for even better protection.

However, this doesn’t guarantee high returns because the price of the crypto assets might experience a dramatic fall or remain more or less the same during that time. What crypto investors can do to make the most out of their crypto investments is to capitalize on compound interest.

The process is no different from investing in the stock market or creating a savings account but instead of depositing fiat currency, you stake crypto.

Let’s say you deposit 1 BTC on a platform that offers a 6% interest rate and compounds the deposit monthly. After one month your balance will grow to 1.005 BTC which means that you’ve earned 0.005 BTC during that time. The next month you’ll earn additional interest on your starting interest and your balance will be 1.010 BTC.

This interest-earning process goes on until you decide to withdraw your crypto.

Earning interest through staking crypto: The formula

There’s a special compound interest formula that calculates the total crypto interest you can earn based on your holdings. Let’s break it down for you:

A = P (1 + r/n)nt

A = the total amount of money including the accumulated interest

P = the principal amount

r = the annual interest rate (as a decimal)

n = the number of times the interest has been compounded

t = time, number of years

The calculations and estimations are a bit different when it comes to crypto compound interest, because the price of the crypto asset will most likely experience some ups and downs during that time.

To make things easier for you, we’ve created our apy crypto calculator that helps you calculate the total amount of crypto interest within seconds.

You need to insert the principal amount of BTC (or another crypto you’re staking) that you’re going to stake and specify whether you’ll make any additional deposits during the holding term or not. You’ll include the compounding interest rate of the platform you’re using and the holding term you’ve agreed on.

The calculator will do the math for you and tell you the future value of your investment, by adding an estimate of the price change of the asset as well. Therefore, based on the crypto price change and the accrued interest, you’ll make your final judgment.