If you’re not earning yield on your crypto, you’re not doing crypto right

One of the biggest differences between the current crypto bull cycle and bull cycles in the past is that we now have a multitude of opportunities to earn yield on our holdings. This benefits investors on an individual basis as well as the market as a whole. Not partaking in yield opportunities may be holding you back from optimal gains and risk/reward ratios. One aspect of crypto that no longer exists in the traditional banking system is the ability to get real interest on dollars. That’s right- there are several platforms where you can take cryptocurrencies (USDC, BUSD, USDT, GUSD) that are backed and pegged to physical dollars and earn passive interest. And it’s not hard! On BlockFi, Voyager, and Celsius, you can easily make 8%+ just by holding dollar backed cryptocurrency on their platform. There is an element of risk involved. However, you could argue that there may be a bigger element of risk involved in hold your money in a non/low yielding bank account. We know that inflation is here and bank solvency is not a given. For these reasons, I have moved a portion of my portfolio into cryptocurrency.

For those who have not read my other articles, I have a three pronged strategy for cryptocurrency- 1) Accumulation and passive yield of Bitcoin, Ethereum, Chainlink, USDC, and Paxgold for long term wealth building. 2) Accumulation and passive yield of mid/large cap altcoins to move to USDC, Ethereum, and Bitcoin as the bull market continues 3) Investing in small/low/microcap cryptocurrencies for outsized gains and high yield opportunities during the bull market. Keep in mind that this article is not financial advice, simply my strategy and reasoning behind it.

Why is earning yield so important? Yield holds multiple purposes-it grows your stack and portfolio, helps you in staying grounded and invested during market volatility, and helps the entire crypto asset class grow . Obviously, it will help you grow your stacks. Let’s imagine a scenario where you are buying 10 Ethereum at $2500 and earning 5% annual interest on it. Let’s say you hold your Ethereum for 6 months and in that period of time, the price of Ethereum doubles to $5000. You now have 10.25 Ethereum that are valued at $51,250. Because of the increase in value in the underlying asset, you have already earned 5% on your…