Bitcoin Made You Rich, Now What?
Most of us who begin investing into the bitcoin and cryptocurrency market all dream about someday the markets will go to the moon, causing us who invested wisely to become rich. But what if that dream actually does become a reality? What would you do then? If bitcoin goes to some of the high price predictions that many have claimed; it is something that we all need to thing about and have a plan for. After all, fools are quickly separated from their money.
One of the most important things that you need to be successful with bitcoin, ethereum or any cryptocurrency is to make a plan and stick to it. There are several different types of places and there is no perfect solution. What is best for you, may not be best for the next person and vice versa. Perhaps your plan is to just dollar cost average into the asset over the years leaving it untouched, using it as a cornerstone for your potential retirement. Or maybe you are just hoping to finally pay off that heavy debt burden of yours. Eliminating debt can be one of the best things to improve your quality of life. Perhaps it is your dream to buy a dream house for your family and potentially retire early. Becoming rich from bitcoin could finally allow you the chance to quit your day job and start your own business. Lastly, maybe you're hoping to move to a tropical island and live the easy life. Your plans could include one of these, or perhaps a combination of all of them. Everyone is different and that is what makes life so exciting.
While all of the above things are the end result of potentially cashing out of your cryptocurrency positions. That leads us to our next question that you need to be able to answer. Are you going to be selling out of your bitcoin position, or keeping it? As for me, bitcoin and cryptocurrency have become one of my greatest passions in life. I can't imagine completely selling out of the market. For starters, it would be much less interesting for me to read about, and what would I do then? Having skin in the game makes things more interesting. Also, if bitcoin would actually go to those projected astronomical price numbers, I would have deep regrets for selling out early. Knowing yourself and how your personality works is a cheat code that will make you even more successful and happy in the future. Because I knew those things above about my personality, and also the likelihood that I would probably never want to sell. I knew that I would need to find some other way to be able to hold onto the bitcoin and ethereum that I do have, while at the same time still being able to take advantage of it and hopefully live my life to the fullest making all of those things in the first paragraph come true. That is why I went so hard into growing a passive income from my bitcoin and ethereum. I have done this through several various methods of either lending out my bitcoin/ethereum, staking, and also mining. My thinking has always been that this would help me to accumulate much more of these assets at a faster pace. And if the prices of these coins go up insanely high, I would then be able to live very well off just the income that these would bring in.
While admittedly this wouldn't net me that incredibly large payday that would would receive by completely selling out of their position. So if I was requiring or in need of that large amount of money to buy a house, or something on that scale there are other options available to me. Using your cryptocurrency as leverage has grown significantly in popular over the last year. Not only would this help you to save significantly on your taxes, because you're not actually selling your crypto, but it allows you to get that large amount of money you need. While there is some large risk, because bitcoin and crypto can be quite volatile. If you have gotten to the point that your crypto portfolio has made you rich, then you should be able to lessen that risk significantly and also make this quite an attractive option. While there are price crashes and you need to be careful to have enough collateral on your account to avoid liquidation. But, on a yearly basis the average low price of bitcoin has always increased. This means that if you used bitcoin as collateral, you should be able to take some of that collateral off the table, as it has become more valuable. You could then use that bitcoin/ethereum that you are lending out on other services, your passive income, to make payments on your loan. If you are lucky enough to have the extra capital, keeping much more than you need on the service lessens your risk significantly. It is an avenue to consider.
That is my approach. Never selling. Instead, having my main portfolio grow in value, while I will use a portion of the passive income that I am earning to live on. As I need it, I would then consider using my BTC as collateral and taking out a loan. I don't see any option where I would sell completely out of my position. But that option still leaves me at risk. As much as I believe in bitcoin and the cryptocurrency market, there is still a possibility that things could end badly and the market could someday go to zero. That is a risk that I am will to take on. But that may not be the best scenario for everyone out there. Some people might feel extremely stressed holding large amounts of money in cryptocurrency, causing them to become very stressed and have an affect on their health. These are all things that you need to consider. Thankfully for myself, I have been through the ringer in this market so many times that I have no doubt in my mental strength and ability to have diamond hands to never sell.
How about you? What was your goal when you entered the bitcoin and cryptocurrency market? What would you do when you became rich? Will you sell out of your position?
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