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Passive Income / Crypto Is Still The Way
I feel the crypto community as a whole got a little ahead of itself and is currently suffering the ramifications of it. LUNA and UST for sure has had one of the biggest crushing impacts on the crypto markets. Not only in price but also just the general damage of crypto itself.
You have to realize that crypto is programed by humans and humans make mistakes or code things in a way to screw people over. What one that is most likely is still unknown. What I know is that LUNA and UST are dead there's simply no money left to try and regain the peg it's flat up broken. A stark reminder of high risk in the crypto markets and why I personally don't believe in stable coins. I never have but of course I'll play with them bit. Old investment rule though never think your money is safe and never put all of your funds into one asset. That includes stable coins! A smarter investor would have taking their $100,000 or whatever amount of UST they had and spread it across at least 5 other stable coins thus reducing risk if something happened to one.
Passive Income
As stated many times before true passive income isn't possible you still have to put in some amount of work in order to manage it and build it. This then comes down to less time over more money production.
In traditional means this was your
- Savings account
- Dividend paying stocks
- Index funds
- Peer 2 peer lending (which pretty much got heavily nixed)
- Real estate investments
- REITs
In crypto these same methods are starting to become realities however it's difficult as your pretty much replacing the FIAT system with a token or another currency to replace it. This would be much like a new country printing their own money but in this case it's now thousands of world wide entities via crypto tokens. Each does their own thing and has their own printing, governance etc and to be honest no ones gotten it right yet nor will they ever most likely.
This means your investments should be looked at in token value and not USD or FIAT value. How many of this token are you earning and what can that token be used for. In most cases it still comes down to exchanging the token for another token which has a value to it in USD. So it all ties back to fiat currency in order for people to make sense of it. It's what we will preserve value in crypto is how much can I exchange 1 bitcoin for USD. It's a ugly truth and it's why stable coins started to become a major thing.
A Shift In Mindset
With crypto you need to start looking at it as how much of this token am I earning passivly and what can it be used for. Things like HBD are good as it's a clear cut this is what I'm getting and the value it should have. For example 1 HBD should be worth $1 USD Fiat but it's rarely ever that value it still pings from $0.90 - $1.10 depending on rallies or sell offs. It most likely will always be susceptible to this. It does earn a 20% rate on it. So while you might think that 1,000 HBD is earning you $200 a year it could in fact be $180 or $210 or another value depending on the fluctuation at the point of sale.
There's nothing to back up any of these cryptos to be honest. If you're going to peg something to a fiat currency then it only make sense to actully have that dollar value safely stored some where and in reality doesn't that pretty much defeat the whole purpose of what crypto was created for?
The idea of creating a new currency and tech that governments couldn't touch and was traded world wide. Restored privacy and returned powers back to the people. It feels like for whatever reason we took a 180 in the last 2-3 years and it's turned into a bigger shit show then ever before!
When you think passive income in crypto start looking at tokens earned and not so much $ earned as that is always going to change.
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