Why a wallet cannot show you profit on its own
The Bitcoin blockchain stores amounts and timestamps. It does not store prices, currencies or the identity of a buyer. When 0.05 BTC arrives at your hardware wallet, the ledger records that 0.05 BTC moved and when, and nothing else. Your actual purchase price lives in an exchange statement, a bank transfer or a receipt, none of which the blockchain sees.
That is why hardware wallets and most wallet apps only show a balance. To show performance, something has to reconstruct a plausible acquisition value.
How BTC Mate estimates performance
- Read the incoming transactions of the tracked address: each amount and the time it was confirmed.
- Look up the historical Bitcoin price at each of those times in your chosen currency.
- Treat that price as the estimated acquisition price for the coins that arrived in that transaction. Adding these up gives an estimated acquisition value for everything the address received.
- Derive an estimated entry price as the average acquisition price weighted by amount, and compare the estimated acquisition value with today's market value. The difference is the estimated profit or loss, shown as an amount and as a percentage.
- Draw the value over time by applying the historical price to the balance the address held on each day, which produces the performance chart for one week, one month, three months, one year or all time.
Outgoing transactions reduce the tracked balance. The app applies an accounting rule to decide which acquisition lots were spent, the same kind of assumption any portfolio tool has to make.
When the estimate is close, and when it is not
The estimate is close when coins moved to the address shortly after they were bought, which is the typical pattern for someone who buys on an exchange and withdraws to cold storage the same day. It drifts in cases like these:
- Delayed withdrawal. You bought in January and withdrew in June: the estimate uses June's price.
- Coins that were never bought. Mined, earned, gifted or inherited coins have no purchase price; the on-chain price at arrival is a reasonable reference point, not a cost.
- One address is not the whole wallet. Most wallets spread coins over several addresses. The estimate describes the coins that arrived at the tracked address, not necessarily your entire holding; add each address that holds coins to get the full picture.
- Internal transfers. Moving coins between your own addresses looks like a new arrival at the destination. Tracking the destination address alone would reset the estimate to the transfer date.
- Fees and exchange spreads. Trading fees and spreads are not on the blockchain and are not part of the estimate.
- Price source. Historical prices come from a market data provider and can differ slightly from the price you saw on your exchange at that moment.
For these reasons BTC Mate labels the figures as estimates in the app: "Est. Entry Price" and "Est. Performance". They are meant to answer "roughly how is this address doing?", not to replace your own records for tax purposes.
What you see in the app
- Address value in your currency and as BTC, with the change over the selected period.
- A performance view that switches between absolute value and percentage change.
- Per-address analysis with estimated entry price and estimated performance since the coins arrived.
- A combined view across all tracked addresses.
Getting a better estimate
Track the address where coins first arrived from the exchange rather than an address you later consolidated into. Keep your own purchase records for anything official. And read the estimate as what it is: an on-chain reconstruction with clearly stated assumptions.