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Retiring Early on Crypto; Is it Possible?

By johnwege | johnwege | 19 Apr 2024


Retiring early on Crypto. Is it even possible anymore? And if it is, what would it take?

Many people like to say they’re in the crypto market for the tech and to help change the world. The truth is that most of us came to this market for the money. We were fed hopes and dreams that crypto would be able to change our lives financially forever. Many people view it as the one lottery ticket that could help them escape their situation. Their one chance to finally escape the daily rat race, and they are all in.

The first thing that you need to know is that we are no longer extremely early in crypto compared to previous cycles. With the spot Bitcoin ETF finally being approved in the US. It has pushed us into the next part of the crypto life-cycle and no one knows what will happen next.

With that said, we are still relatively early. meaning that it is still possible to become rich via crypto. However, it won’t be as easy as it once was. 

If your goal is to become rich with crypto; when building your portfolio you need to cater it to better reach your goals. 

Perhaps your goal is to build a rock-solid portfolio of assets such as Bitcoin and others that will grow and appreciate over time. 

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This is the approach that most OGs in the crypto market took to accumulate most of their wealth. Amongst these people; there is a famous way of thinking about how long it takes to officially “make it” in the cryptocurrency market. 

During your 1st full crypto cycle, you can make good to great gains.

Then during your 2nd full cycle, you can become rich. 

Finally, during your 34d full cycle; you can obtain generational wealth. 

This way of thinking in crypto has taught people to maintain a long-term approach. Helping them to tune out the noise and avoid the dangers that are seemingly everything in the crypto market. Dangers such as using high-leverage, or even going too deep into the altcoin forest attempting to hit the lottery and become rich overnight.

Investing in the blue-chips of crypto may not make you instantly rich. However, it will allow you to build a portfolio that will stand the test of time. After all, it’s not important how much money you make, but instead how much you are able to keep. By looking several cycles down the line, you will be able to obtain life-changing wealth in crypto.

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The other alternative to retiring in crypto is building a passive income stream that continues to earn money even while you sleep. For many people, this is the absolute dream.

As it currently stands, the best way to achieve this is by staking coins to earn staking rewards. Proof-of-stake blockchains such as Ethereum, Solana, Polkadot, Cardano, Internet Computer, and several others all offer staking or governance rewards to earn a passive income. 

When you are just beginning to build your crypto portfolio the staking rewards that you receive will seem small and nothing to be excited about.

However, most people are forgetting how young and volatile this market is. During bull cycles, projects often increase in value by 10x, 50x, and even 100x. Perhaps in the beginning you will only be receiving $2 worth of staking rewards each month.

But then during the bull cycle, your crypto went up by 10x, and now your passive income is $20 per month. It then goes up 50x and now you are earning $100 per month. All of a sudden, that minuscule interest you were earning each month has become something significant. Continuing to add to your positions and staking will keep compounding this. A handful of years down the line you will have been able to build an incredible passive income stream. 

The danger here is that it is still critically important to pick the correct projects. While a new project may be claiming that you can earn 30% APY staking rewards. 30% of a project that goes to $0 is nothing to be excited about. 

As the years go by I have tried to build my portfolio using both of these methods to reach my goals. A majority of my portfolio consists of Bitcoin, as it is the safest crypto asset and still has plenty of room to grow. On the other hand, I continue building up my passive income stream by investing heavily in other projects such as Ethereum, Solana, and Internet Computer. 

In this market having patience is one of the most important traits that will determine if you are successful in crypto or not. It’s still possible to get rich from crypto, but time is running out.

How about you? What’s your crypto portfolio strategy?

 

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