Impermanent Loss Calculator
Impermanent loss is the cost a liquidity provider pays when the two tokens in a 50/50 pool move apart in price: the pool rebalances against you, leaving you worse off than if you had just held. This calculator uses the standard constant-product formula. Enter the old and new prices of one token relative to the other and your initial deposit value to see the percentage loss and the value gap versus holding.
Impermanent loss formula
Price ratio r = new price / old price
Impermanent loss = 2 * sqrt(r) / (1 + r) - 1
Hold value = initial deposit, revalued: deposit * (1 + r) / 2
Pool value = hold value * (1 + impermanent loss)
Value gap = pool value - hold value
The hold value assumes the deposit was split 50/50 by value at the start, so half tracks token A's price change and half stays in token B. Impermanent loss is shown as a negative percentage.
Worked example
Token A doubles: old price 100, new price 200, so r = 2. Impermanent loss = 2 * sqrt(2) / (1 + 2) - 1 = 2 * 1.41421 / 3 - 1 = 0.94281 - 1 = -0.05719, or -5.72%. On a 10,000 deposit, hold value = 10,000 * (1 + 2) / 2 = 15,000. Pool value = 15,000 * (1 - 0.0572) = 14,142.14. The value gap is about -857.86 versus holding.
Impermanent loss: frequently asked questions
What is impermanent loss?
Impermanent loss is the gap between the value of assets held in a 50/50 automated market maker pool and the value of simply holding the same assets, caused by price divergence between the two tokens. It is impermanent because it reverses if prices return to their original ratio; it becomes permanent if you withdraw while prices have diverged.
What is the impermanent loss formula?
For a constant-product (Uniswap v2 style) 50/50 pool, with price ratio r equal to the new price divided by the old price for one token relative to the other, impermanent loss = 2 * sqrt(r) / (1 + r) - 1. The result is always less than or equal to zero. A 2x price move gives about -5.7%; a 4x move about -20%.
Does impermanent loss mean I lose money overall?
Not necessarily. Trading fees and any farming rewards can outweigh impermanent loss. The loss figure here compares the pool value to holding, before fees. Your net outcome is the pool value plus accrued fees and rewards versus the hold value.
Sources and method
- Method: the standard constant-product (x times y equals k) impermanent loss identity, 2 * sqrt(r) / (1 + r) - 1; public automated market maker mathematics. No external prices are fetched.
- U.S. Commodity Futures Trading Commission, digital asset education: CFTC: Learn and Protect.
Reviewed by the CalculatorHub team, edited by James Graham, 19 June 2026. See our methodology.