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Bitcoin Return Calculator with Inflation Adjustment

Written by:
PK

On this page we present a bitcoin return calculator.  Enter any two dates between July 17, 2010 and a final date and we will estimate the annual and total return on any money invested in bitcoin. Enter a starting investment value and the bitcoin tool will guess the investment value on the final date.

Optionally, you can also adjust the bitcoin price return and final price for inflation. We use the CPI-U index, interpolated or extrapolated to find a bitcoin investment's value on your investment date.

Bitcoin Price Return Calculator with Inflation Adjustment

The bitcoin return calculator uses data from BraveNewCoin via Quandl as well as historical bitcoin return data from Bitcoinity.

Using the Bitcoin Price Return Calculator

There are only a few options when using the bitcoin return calculator, but any small adjustments can have major effects on your results.

Investing Options

  • Starting Investment ($): The dollar amount invested in bitcoin on the 'Starting Date'.
  • Starting Date: The date the bitcoins were first purchased.
  • Ending Date: The date bitcoins are sold, or a date to estimate the bitcoin holding value.
  • Adjust for Inflation (CPI): If checked, the return percentages and terminal value of the investment are CPI-U adjusted to account for inflation. For dates later than the last print, we use linear extrapolation to estimate inflation. For dates between readings, we use interpolation.

Bitcoin Return Output Results

  • Total Return (%): The total return of the bitcoin investment if purchased on the 'Starting Date' and sold on the 'Ending Date'. (CPI adjusted if selected.)
  • Annualized Return (%): Unlike total return, the return of the bitcoin investment when normalized to provide annual results. (Again, CPI adjusted if selected.)
  • Ending Value ($): The terminal value of the bitcoin investment on the 'Ending Date'. (Once more, CPI adjusted if checked).
  • CPI Adjusted? Flags a CPI adjustment on the return and investment fields.

Sources and Methodology for the Bitcoin Price Return Calculator

The bitcoin return calculator uses data from BitFinex and Bitcoinity. Wherever the Bitcoinity data includes multiple exchanges, we used the average daily bitcoin price on all exchanges. For the three gaps in the dataset – 6/21/2011 - 6/22/2011, 6/24/2011 - 6/25/2011, and 6/27/2011 - 7/04/2011 – we interpolated the available data to backfill bitcoin prices on those dates.

If there is both Bitcoinity Data and BitFinex data, the BitFinex data takes precedence. In practice, this means the recent data all comes from BitFinex.

Note that bitcoin markets don't "close" in the sense that a stock market might. Bitcoin closing prices are as reported by an exchange. On top of reporting differences, different exchanges may have different bitcoin prices for each date. Also, bitcoin can be extremely volatile intraday; note that the prices internal to our tool may be 10% – or more – different than the prices paid by some market participants in the same 24-hour period.

We believe the trends are correct for the tool, and it's a reasonably good guess at how a typical bitcoin investor would have performed between two dates. However, this tool is for informational or research purposes only. Do your own due diligence.

Bitcoin as a Speculative Investment

The bitcoin return results quoted should in no way be taken as advice on whether to invest in bitcoin or other cryptocurrencies. Cryptocurrencies, as an asset class, have demonstrated more volatility than any of the other investments we've featured on this site in calculator format. (See, for example, the Litecoin return calculator.)

Bitcoin return calculator: a bitcoin logo
Bitcoin is a speculation, but potentially lucrative. Do your research.

For bitcoins, the time of day any bitcoin was bought or sold makes investor performance vary wildly. As we argued in the 2017 bitcoin return piece, bitcoin is closer to a speculation than an investment.

Bitcoin and other cryptocurrency investors have had extremely remarkable runs as well as harrowing drops. We'll repeat our advice: for the vast majority of investors, we recommend a regular asset allocation and passively managed index funds. However, if you do the research and still feel bitcoin makes sense in your portfolio, hopefully our calculator goes some of the way to easing your research burden.

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