Why run a crypto stress test
Most people think about crypto in terms of what it might gain, but the question that protects your finances is what it might lose.
Crypto prices have fallen by more than half on several occasions, and smaller coins have often fallen further or never recovered.
The crypto stress test puts those scenarios into euros and into months of living costs, which makes them easier to judge than a percentage.
Crypto stress test example
Example: a household holds €6,000 in crypto and €14,000 in other savings, and its essential expenses are €1,800 a month.
| Scenario (example) | Crypto lost | Effect on all savings | Equal to |
|---|---|---|---|
| −30% | €1,800 | −9% of all savings | 1 month of expenses |
| −50% | €3,000 | −15% of all savings | 1.7 months of expenses |
| −80% | €4,800 | −24% of all savings | 2.7 months of expenses |
Illustrative example calculated with the crypto stress test above.
With crypto at 30% of savings, an 80% fall takes almost a quarter of everything the household has saved.
How to read your crypto stress test
- A fall you could live with: if even the −80% row would not change your plans, your crypto share is within what you can afford to lose.
- A fall that would hurt: if the −50% row would force you to delay something important, consider lowering your crypto share.
- A fall you could not absorb: if a fall would leave you unable to cover expenses, the amount is too large for your situation.
The portfolio share calculator shows how much to sell or buy to reach a target share.
What counts as savings in the crypto stress test
Count money you could use if you needed it: bank savings, funds, shares and similar investments.
Do not count your home or your pension, because you cannot easily turn them into cash to cover a gap.
If you have no other savings at all, the crypto stress test will show that every fall hits all of your savings, which is a sign to build a buffer first.
Essential expenses
Essential expenses are the costs you must pay every month: rent or mortgage, energy, food, insurance, transport and loan payments.
Expressing a loss in months of expenses shows how long the money would have kept you going if your income stopped.
The emergency fund calculator helps you set a buffer based on the same figure.
Stress-testing debt
If you borrowed to buy crypto, a fall does not reduce what you owe.
In that case, subtract the debt from your savings before running the crypto stress test, because the debt will have to be repaid whatever happens to the price.
The debt versus invest calculator shows why repaying expensive debt usually comes first.
Scenarios beyond price falls
A price fall is not the only way to lose money in crypto, and a complete stress test considers the others too.
| Scenario | How to limit it |
|---|---|
| A scam or fake platform | Use only authorised exchanges and check them in the ESMA register |
| Account takeover | Two-factor authentication and a withdrawal address allow-list |
| Lost recovery phrase | Safe, offline storage of the phrase, as the guide to seed phrases explains |
| Exchange failure | An authorised exchange with segregated client assets, or self-custody |
After the crypto stress test
- Decide your maximum share: the share of savings whose −80% scenario you could live with.
- Write it down: a rule set in calm times is easier to follow in a crash.
- Rebalance when needed: if crypto rises far above your share, consider selling some back to it.
- Repeat once a year: or whenever your savings or expenses change.
Crypto stress test at different crypto shares
Example: total savings of €20,000, with different amounts in crypto, and an 80% fall.
| Crypto share | Crypto holdings | Loss in −80% | Effect on all savings |
|---|---|---|---|
| 5% | €1,000 | €800 | −4% |
| 10% | €2,000 | €1,600 | −8% |
| 25% | €5,000 | €4,000 | −20% |
| 50% | €10,000 | €8,000 | −40% |
Illustrative; calculated as share × 80%.
The share you choose decides how much a severe fall can hurt, far more than the coin you choose.
Crypto stress test after a rise
A stress test is most useful after prices have risen, because that is when crypto's share of savings is largest and a fall would hurt most.
Example: €2,000 of crypto doubles to €4,000 while other savings stay at €18,000; the share rises from 10% to about 18%, and an 80% fall would now take €3,200 instead of €1,600.
Illustrative.
The portfolio share calculator shows how much to sell to return to your target share.
Crypto stress test for households
If you share finances, run the stress test on the household's combined savings and expenses.
A fall that one person could live with may affect plans that both partners rely on, such as a home purchase.
Agreeing on a maximum share together avoids surprises.
Crypto stress test and income risk
A fall in crypto sometimes coincides with wider economic stress, when jobs are also less secure.
Running the stress test with lower income in mind, for example by asking how many months your other savings would last without salary, gives a more cautious picture.
The emergency fund calculator helps you set that buffer.
What to do if the crypto stress test worries you
- Lower the share to a level whose −80% result you could live with.
- Pause new purchases until your buffer is complete.
- Avoid selling in a panic: reduce gradually and by plan.
- Check your exchange and account security, because non-price risks add to market risk.
Crypto stress test: a worked household example
Example: savings of €15,000, of which €3,000 is crypto, and essential costs of €1,800 a month.
| Scenario | Crypto value | Total savings | Months of costs covered |
|---|---|---|---|
| Today | €3,000 | €15,000 | 8.3 |
| Crypto falls 50% | €1,500 | €13,500 | 7.5 |
| Crypto falls 80% | €600 | €12,600 | 7.0 |
| Crypto falls 80% and income stops for 3 months | €600 | €7,200 | 4.0 |
Example only; costs during the 3 months without income are taken from savings.
In this example, the household can absorb a large crypto fall, and the bigger risk is losing income.
Crypto stress test: what a passing result looks like
- An 80% fall in crypto would not stop you paying rent, food or loans.
- Your emergency fund would still cover several months of costs.
- You would not need to sell crypto at a low price to meet any planned expense.
- You could live with the loss without changing your long-term plans.
Crypto stress test: combined shocks
Bad news often comes together: a falling market can coincide with job cuts, higher interest rates or rising prices.
Testing one shock at a time can make a situation look safer than it is.
Try at least one scenario where crypto falls sharply and your income drops at the same time.
Crypto stress test: questions readers ask
Why test an 80% fall? Large crypto-assets have fallen by that much or more in past market cycles, and smaller coins have fallen further or failed completely.
What if I fail the test? Lowering the amount in crypto, building savings or repaying debt first are the usual steps, as explained above.
How often should I run it? Once a year and after any big change in your finances or in the value of your crypto.
Saving the result, for example as a screenshot or a note, makes it easy to compare with next year's crypto stress test.
A falling result over time is a signal to reduce risk before a real shock arrives.
Crypto stress test and planned expenses
Money needed for a known expense within a few years, such as a car, studies or a home deposit, should not depend on crypto prices.
Add such expenses to the crypto stress test as fixed needs, and check that they are covered even after a large fall.
Frequently asked questions
What is a crypto stress test?
It is a way to see what large price falls would do to your crypto, to your total savings and to your ability to cover expenses.
Why does the crypto stress test use 30%, 50% and 80%?
They represent a moderate, a large and a severe fall. Crypto prices have fallen by more than half on several occasions, and small coins have often fallen further.
Is an 80% fall realistic?
Falls of that size have happened in crypto markets, and some coins have lost almost all their value. The test does not predict a fall; it shows what one would mean.
What share of savings should be in crypto?
There is no rule that fits everyone. A practical limit is the share whose severe-fall scenario would not change your plans or your ability to pay bills.
Should I include my pension in the crypto stress test?
No. Count only savings you could use if needed, because a pension or a home cannot easily cover a short-term gap.
Is my data saved when I use the crypto stress test?
No. Everything runs in your browser and nothing is stored or sent.
Every figure on this page is checked against the ESMA register, the exchange's own terms and fee pages or another primary source, and the sources are listed above. Editorial policy · How we rate