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📊 Profit Calculation: Gas vs Revenue

Learn how to calculate MEV profitability and competition dynamics

Discover how bots profit from transaction ordering

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Profit Calculation

Successful MEV extraction requires precise profit calculations. Every opportunity must account for gas costs, slippage, competition, and execution risk. A simple arbitrage might seem profitable at first glance, but gas costs can easily eat all profits—or worse, result in a net loss.

Professional searchers run simulations before submitting transactions, calculating expected value across different gas prices and considering the probability of transaction inclusion. The key is maximizing profit while minimizing risk.

Interactive: MEV Profit Calculator

Calculate profitability of an arbitrage opportunity with real-time gas cost analysis.

Arbitrage Parameters

10 ETH
0.5%
30 gwei
150,000
$2,000

Profit Analysis

Revenue (price gap)$100.00
Gas Cost-$9.00
Net Profit$91.00
Profit Margin91.0%
✓ Profitable Trade
Calculation Breakdown:
• Revenue = 10 ETH × $2000 × 0.5% = $100.00
• Gas = 150,000 units × 30 gwei = 0.004500 ETH ($9.00)
• Net Profit = $100.00 - $9.00 = $91.00

Key Profit Factors

📊 Opportunity Size

Larger arbitrage gaps = higher absolute profit, but also attract more competition. Small gaps (0.1-0.5%) are common but barely profitable after gas. Sweet spot is 0.5-2% gaps.

⛽ Gas Optimization

Every opcode counts. Reducing 150k gas to 100k gas saves $10-100 per transaction. At high volume, this is the difference between profit and loss. Use assembly, batch operations, optimize storage.

⏱️ Execution Speed

Latency kills MEV. You need <100ms to detect, calculate, and submit. Colocate nodes near validators, use private RPCs, optimize network paths. Every millisecond matters in competitive environments.

🎯 Success Rate

Not every transaction succeeds. Uncle risk, competition, slippage, and reverts reduce actual profit. Professional searchers achieve 60-80% success rates. Calculate expected value: profit × success_rate.

Real-World Profit Examples

Small Arbitrage$50
2 ETH trade, 1.5% gap, 150k gas @ 30 gwei → Very common, low competition
Medium Liquidation$2,500
$50k position, 5% bonus, 200k gas @ 50 gwei → Daily occurrence, moderate competition
Large Sandwich$15,000
Whale trade, 2% slippage capture, 300k gas @ 100 gwei → Rare, extreme competition
JIT Liquidity$50,000
$10M swap, LP fees, 400k gas @ 80 gwei → Very rare, requires huge capital

💡 Profitability Rules

  • 1.Always simulate before submitting—failed transactions waste gas and capital
  • 2.Account for slippage—prices move between detection and execution
  • 3.Use Flashbots bundles—failed bundles don't cost gas
  • 4.Optimize gas ruthlessly—every 1000 gas saved = $0.06 at 30 gwei
  • 5.Monitor network conditions—high gas = fewer opportunities profitable
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