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What are unrealized gains in the context of cryptocurrency?

avatarKlemmensen NordentoftDec 26, 2021 · 3 years ago3 answers

Can you explain what unrealized gains mean in the context of cryptocurrency? How do they differ from realized gains?

What are unrealized gains in the context of cryptocurrency?

3 answers

  • avatarDec 26, 2021 · 3 years ago
    Unrealized gains in the context of cryptocurrency refer to the increase in value of your cryptocurrency holdings that you have not yet sold. It represents the potential profit you could make if you were to sell your holdings at the current market price. Unrealized gains are not actualized until you sell your cryptocurrency. On the other hand, realized gains are the profits you have made from selling your cryptocurrency holdings. So, the main difference between unrealized gains and realized gains is that unrealized gains are hypothetical and based on the current market value, while realized gains are the actual profits you have made from selling your cryptocurrency.
  • avatarDec 26, 2021 · 3 years ago
    Unrealized gains in cryptocurrency are like the dreams of hitting the jackpot. It's the increase in value of your crypto holdings that you haven't cashed in yet. It's like having a winning lottery ticket in your pocket, but you haven't claimed your prize. Until you sell your crypto, those gains are just numbers on a screen. Realized gains, on the other hand, are like cashing in that winning ticket and getting the money in your hands. So, unrealized gains are all about potential, while realized gains are the real deal.
  • avatarDec 26, 2021 · 3 years ago
    Unrealized gains in the context of cryptocurrency are the gains you see on your portfolio but haven't actually cashed out yet. It's like looking at your investment account and seeing the numbers go up, but until you sell your crypto, those gains are just on paper. Realized gains, on the other hand, are the gains you get when you actually sell your crypto. So, unrealized gains are like daydreaming about all the money you could make, while realized gains are the sweet taste of success.