Compound vs simple interest
Simple interest pays on the principal only, so each period earns the same amount. Compound interest folds each period's return back into the principal — interest on interest.
The longer the horizon and the more frequent the compounding, the wider the gap. A 1% period rate compounded 365 times is far above the "1% × 365" intuition.
Formulas
previous balance × (1 + rate per period)principal × (1 + rate per period)^periodsfinal value − principal(final value − principal) ÷ principal × 100%Worked example (recompute it yourself)
Principal 1,000 USDT, 1% per period, 365 periods:
Growth factor = 1.01^365 ≈ 37.78, so final value ≈ 37,783 USDT and total gain ≈ 36,783 USDT.
For contrast, treating 1% × 365 as simple interest gives 4,650 USDT. The power of compounding comes from repeatedly folding returns into the principal.
Risk notice (please read)
This is a mathematical simulation. It is not actual investment performance, and no strategy is promised to sustain any given periodic return.
Real results are affected by price volatility, fees, slippage, funding rates and liquidity — and the principal can lose value.
Figures like "1% a day" are calculator inputs, not achievable or sustainable return promises.
FAQ
What is 1% daily compounded for a year?
The growth factor is about 1.01^365 ≈ 37.78x, turning 1,000 USDT into roughly 37,783 USDT. It is a math result; sustaining 1% daily in practice is not realistic.
How should I pick the compounding frequency?
Match the rate to the frequency: a daily rate with daily compounding, a monthly rate with monthly. Mixing them inflates the result.
Does this calculator predict returns?
No. It rolls your entered rate forward period by period to illustrate how compounding works. It contains no market view.