Sirwin
Sirwin

Always Staking – My Primary Crypto Strategy

By rah | rah | 14 Feb 2022


This is the second article I have “written” using Microsoft’s dictation tool. So I apologise in advance for any mistakes that I miss through a reread. As you know I’m starting to use this tool as I have some difficulties with my fingers and one in particular which may well be arthritis which I have in other parts of my body, which is incredibly frustrating when I’m a writer.

I never thought I would ever say thank God for Microsoft!

Anyhow to the point of today’s article. The key to any financial success is to ensure that any investment at the very least outstrips inflation. At this particular point in time with inflation going through the roof, especially gas and electricity prices, this is even more challenging than it has been in recent years. With possible war in Ukraine looming, which will lead to the effective shutdown of Gazprom’s international sales we can see these prices increasing even more at least for the short term.

So it’s all looking a bit bleak, but beyond that I basically have two crypto accounts.

Celsius is locked into long term staking. On it I have a significant amount of stablecoin which is staking quite nicely at above inflationary rates. I also send all of my Noise:Cash Bitcoin Cash there and any free Bitcoin that I acquire as I’m going along through faucets like Cointiply. Additionally, I have a little bit of Ethereum from back in the days when it was a supported tipping currency on Publish0x.

Secondly, I have Coinbase as my primary trading account. Fees are known to be high and it’s not necessarily the most ideal platform when it comes to trading. However, funds are underwritten and while their staking options are not necessarily the best they are certainly good enough to work with my primary strategy. The key to this strategy is recognising and utilising those staking currencies.

At this point in time, Coinbase offers staking options in the following currencies; DAI, TEZOs, Cosmos and Algorand as well as Ethereum 2 which is currently not available for trading. With DAI being a stablecoin this presents the investor with a perfect opportunity.

Especially for me because you know I am a big fan of DAI which I dubbed Crypto's SuperCoin.

super_coin

DAI only stakes at 2%, but this is far better than your fiat will get in the banks. As a stablecoin its value doesn’t fluctuate or if your fiat is not the US dollar it moves very little. So the key is to hold all of your assets in one of these staking occurrences. However, for the time being I wouldn’t necessarily invest in Ethereum 2 unless you are planning to hodl for a very long time. As a headline grabber Cosmos is the best option coming in at 5%. This is still below current inflation rates but between the staking and investment pairing yields greater than 5% should be easily achievable.

As always currency values can go up and down and it is a case of buying and selling at the right time. One of the things I like about this method is that with always staking the amount of crypto, even if the value, is not rising, is always increasing.

Start thinking of your DAI as your base currency rather than your fiat. So now that has been established I will demonstrate how this works.

Frequently when currency increases in value exponentially it is followed by a correction, a sudden reversal in price which may not be as dramatic and of course vice versa. A note of caution, an exponential increase might just be the start of a surge that takes a few days to plateaux out or correct. So please be careful always DYOR.

Example 1: DAI into a Target Currency

Take a round amount of DAI, like 200 DAI or as near as possible (on Coinbase the chances of getting exactly 200 is remote so I always go slightly under) and convert it to, for example, Cosmos after Cosmos has dipped by greater than 10% or more ideally more than 15%. Unless it is at the beginnings of a bear market recovery is almost certain to recover.

Let’s look at some numbers, but please remember these are illustrative only.

I convert 199.59341 DAI into 7 Cosmos.

I now wait for market conditions to shift and I can check this by having in mind the price I paid for one Cosmos and using the Preview Transaction function. The conditions you are looking for ideally is greater than 200 DAI for less than seven cosmos.

So when the preview shows me, again for example, 205 DAI  for 6.9 Cosmos I have gained in both currencies (+5 DAI, +0.1 Cosmos).

The beauty is at once you are holding at least one whole unit of any currency it starts staking. It will take some time to get a whole Cosmos like this so you might want to consider holding at least one anyway (or using Coinbase Earn’s airdrops to get you nearer). So if you are doing it for the first time work out a profitable DAI price for 5.95 cosmos (That will leave you with 1.05 Cosmos). Please bear in mind you will not get 200 DAI back, but at least everything is then staking.

Repeat, repeat and repeat building up stockpiles of both currencies. I would further suggest if you start with 200 DAI, you should look to increase your stable underlying DAI growth. So for example every time you have gained another 10 DAI add 5 to the investment pile. So you are now investing 205. When you reach 220 you will now be investing 210 and when you reach 230 you will be investing 215 and so on. This means your underlying DAI holdings will continue to increase and achieve ever increasing staking value and as a stablecoin it means your portfolio value’s growth is underpinned  and stabilised.

It might be worth pointing out, if you didn’t know that staking rewards in Cryptocurrency and not in the fiat value of it.

As an easy trading method it has one more advantage because gas becomes irrelevant, you just need to make sure but you will achieve net gains in both currencies.

Example 2: Target Currency to DAI

This doesn’t need such a lengthy explanation as I am doing the same but in the opposite direction.

Simply if there is a surge in your non stablecoin currency such as Cosmos use it to buy DAI and when the correction comes buy back more of your currency and make sure you leave a little bit more DAI behind.

So this time if you have seven Cosmos and it surges convert to DAI and wait for the correction. The correct point is when you can buy more cosmos back for less die then you converted it to.

Transaction 1 = 7 Cosmos to 200 DAI

Transaction 2=7.2 Cosmos for 196 DAI

It really is as simple as that.

And remember because you were always staking and you have miscalculated the movement in currency you can just wait it out and I tear currency stockpile in the meantime.

Win – Win.

I’m not quite in the position that I would like to be in, in which every single asset I own is staking. This is predominantly due to the fact that I bought some band just before the may dip and it has yet to recover do anything like the price that it was at the time, even though I paid less than 50% of it all-time high. So I’m hustling the hell out of it until it comes back to me. Then it will be redirected to one of my staking currencies.

So my aspiration is exactly what the title says, Always Staking.

Happy trading, stay safe, stay well, always do your own research and never invest more than you are prepared to lose.

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rah
rah

I love reading and technology as well as history. I teach English and Business to professional clients as well as soft skills with a focus on communications. I am a big fan of both Sheffield Wednesday and Lincoln City Football clubs


rah
rah

Experienced Business Owner and Coach and Tutor who now trades in Crypto. It is proving to be an interesting journey with so much technical language involved. Follow me as I learn the trade (and how to trade). Made some howling mistakes to begin with, but still learning and will share what I learn as I learn it for the benefit of the community. - RAH

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