Two "Safe" Passive Crypto Income Investments I Made Today
To be honest, I like being somewhat risky with my crypto investments. I own a decent sized stock portfolio so my crypto holdings equate to about a third of one percent of my overall net worth. The bulk of my crypto investments are split between Bitcoin and Ethereum, however, I also have some yield farming investments and own a small amount in various altcoins.
Now I'm wanting to increase my exposure to crypto, partially because my understanding of the space has grown dramatically since I first got involved in but also because it is so much fun. Stock investing has always been very hands off for me, automate everything and let it grow over many years. It has been a very successful approach, but also very boring.
I'm actually fairly risky when it comes to stocks, but am comfortable with that approach because I take a long-term view. I am heavy in small cap and tech stocks, and since I don't rebalance that portion of my investments has grown and grown over the years. I had always heard that 10% a year in stocks is a decent return, I've averaged around 17% per year, but stocks are also a pretty risky play.
The question I've been asking myself this month has been - Can I find investments in crypto with higher return than stocks but with less risk? The return side of the equation is pretty straight forward, the risk side is more difficult to determine.
Investment One - Stable Coins
The first investment I made today that I'm going to try to beat stock returns with is in stable coins. I've purchased some Tether (USDT) and have moved it to my Midas Investments account where it will earn 20% APY. There is minimal risk with a stable coin pegged to the US dollar and Tether has been classified as the safest of all stable coins, which is debatable in my opinion, and in full disclosure I also own some BUSD that I use in yield farming on Binance Smart Chain.
Some may point to Midas as risky, however, I hold BTC there (13% APY) and ETH (18% APY) and have had no problems with them. They have a solid four-year track period and have an open and transparent management team which I respect. There are other platforms in which I could generate a similar return, but they carry more risk in most cases, and again I already have some investments with Midas (I do also hold BTC and ETH elsewhere but the returns are not even close).
While I hadn't invested any USDT with Midas before, I have earned some via referrals (FYI - the link above is a referral link) which is paid out in USDT and I am also making a daily return. This is what got my wheels spinning here as the daily returns started rolling in.
The beauty in stable coin investing like this is that it is very easy to determine how much you need to generate a given amount of passive income. For example, if I want to generate $1,000 a month I would need to invest $60,000 ($60,000 x .2 = $12,000). Now, I'm just testing this out initially so only put in $1K which should generate $200 over the next twelve months. Transferring any crypto always makes me nervous so I never do a crazy amount to start with. Staking coins is truly passive, however, much like stock investing so I wanted to spice things up just a little...
Investment Two - Master Nodes
My second investment made today that should easily beat the stock market with but does have more risk exposure to is master nodes. I detailed my thought process with this investment in my two articles from earlier this week:
I selected the Yield Nodes platform to invest in which has never had a negative month and has an average return of 10% per month which compounds to over 200% per year. After doing a fair amount of research into master nodes, this seemed like the safest bet to get started in this area of crypto.
In full transparency, I used crypto.com to buy and send crypto to both platforms. Yield Nodes accepts Tether so I tried that first, however, you have to transfer it on a Tron (TRC-20) address and I didn't have that capability from crypto.com so I simply used that Tether to put into Midas. I also wanted to put a little more into the Yield Nodes platform so I bought and transferred .05 BTC which was valued at just over $2K at the time. This should generate about $200 in the first month alone which equate to $2,400 the first year if I take profits and do not reinvest. I do plan to reinvest a sizable portion of it this year. It takes about a week to get up and running on Yield Nodes once the transfer is complete so I will follow up at the end of my first full month at the end of April to let you know how that is going.
Goal of these Investments
The goal of these investments is to provide steady passive income eventually and help even out the volitivity of the crypto market. I first got involved in crypto in November of last year and since that peak I have seen nothing but declines ever since. I am grateful for this as it has lowered my cost basis for everything and allowed me to acquire coins at a faster rate. It has also shown me the danger in crypto and just how up-and-down this market can be so I'm now looking to add investments that will do well even when the rest of my holdings are falling.
So what safe crypto investments are you in generating decent returns?
