¿What is ROI in Crypto?

ROI in Crypto is the Return On Investment that measures the profit or loss you get after investing money in a decentralized protocol, blockchain-based financial platform or cryptocurrency asset. It tells you how much you actually gained or lost, regardless of how long the investment took.

Is a different KPI (Key Performance Indicator) from APY (Annual Percentage Yield). Both are useful for analyzing investments opportunities.

The formula is:

ROI (%) = [(Final Value – Initial Investment) ÷ Initial Investment] × 100

Step by step:

1. Subtract your initial investment from the final value you received after withdrawing or claiming funds.
2. Divide that result by your initial investment.
3. Multiply everything by 100 to get the percentage.

Example:
You invest $1,000 in a DeFi pool. After some time, you withdraw $1,200.

ROI = [(1,200 – 1,000) ÷ 1,000] × 100 = 20% profit.