Ethereum has correlated along with the rest of the market which means prices are low, low, low.
Time to hodl, hodl, hodl!
Buy if you please right now, however, there is an overall impression that this crash will go further.
But again, hodl, hodl, hodl!
Bitcoin might drop to as low as 3k maybe even 1k if things get really terrible.
Except that there is a likely hood it may just hover!
The fact of the matter is, in 6 months to a year from now we will see those high record smashing numbers.
Until then what else do I really have except for Bitcoin?
Altcoins of course but what sort of altcoins?
The ones I have been mainly focused on are the ones that make you passive income.
Tezos for example most famously offers what is called "Staking" as I'm sure a ton of people in the crypto community have found out about.
Some of you are like... Duh... get on with it! Does it really matter?
Yes! It does a lot too!
Ethereum 2.0 is going into effect this year with the option to now Stake Ethereum that you own in return for rewards in the form of Ethereum.
It will be interesting to see how much of a reward you are granted for proving your stake of Ethereum holdings.
Will it be similar to Tezos XTZ at average rates of around 5%?
So far that is what we have seen from Tezos, but will Ethereum be gracious and kind?
Over at Crypto.com users can stake 12% on CRO flexibly for doing something similar gaining yearly interest.
The numbers aren't out yet according to many sources and testnets are probably sworn to secrecy...
Great source for the Future of Ethereum Staking:
https://ethstaking.io/what-is-ethereum-staking/
So for now with Ethereum staking I need to be realistic and the only way to do that is to break down some math.
Breaking it down can help me gauge an idea of what I should expect and if people should even waste their time buying up Ethereum.
Afterall, time is money, and if I spend months buying ethereum that I could have been using in a different digital asset.
That is a lot of time and money wasted!
Ahhhhhhhhh!!!!
Here are some guesstimates based on what is offered at other places that offer staking as well as compound interest related rewards for holding.
1. Ethereum is currently worth $116.16 at the time of this writing 8:15 pm PST
2. Ethereum can gain interest on many platforms in the meantime, additionally, some places offer interest rates to holders of Ethereum. There are a lot of numbers but based on the average and most widely popular percentages. For now it is safe to assume in my opinion that Staking Ethereum will offer rates of 5% pear year.
3. As a small example, pretend we could stake ETH right now at its current price of roughly $116.16 and you give Melvin 1 whole Ethereum.
4. Melvin uses a service that with his 1 Ethereum that gives him 5% yearly of his Ethereum. When it gets paid out does not matter for this example.
5. When we take 5% of 1 Ethereum then Melvin gets rewarded 0.05 ETH as long as he leaves it in there for that full 1 year of 365 days
6. Assuming the price of Ethereum stays at $116.16 365 days later. That 0.05 Ethereum will be worth $5.82 USD! Them gains tho!
7. Let's assume the price of Ethereum is doubled! That makes Melvin's 0.05 Ethereum worth a whopping $11.64! Whew nelly!
8. As a big example, Melvin's girlfriend Jill has 10 Ethereum right now at $116.16 a pop USD. Jill has 10 more Ethereum than Melvin because she wears the pants in the relationship.
9. Jill also earns 5% per year on her holdings making her yearly output 0.5 ETH
10. Assuming the price of Ethereum is somehow the same at $116.16 USD Jill can safely that 0.5 ETH she made was $58.20 USD.
11. Assuming the Price of Ethereum doubles Jill can say she made $116.40 of the 0.5 she gained from holding Ethereum Proof-of-Stake
12. Moral of the story, be more like Jill, don't be a Melvin.
Don't be a Melvin as much as you can humanly manage it! The truth is that even at 5% you are not going to want to miss out on the rewards for that much like you are not going to want to miss out on the rewards that come from staking Tezos XTZ.
Looking at this now it is easier to see because you have to buy it when the prices are ultra-low like they are currently.
Also you have to buy with the intention that you are truly going to hold it there for 1 whole year!
Now of course, if before a year comes and the price of your Ethereum or Tezos skyrockets. Take it out!
Hodling is great and all but knowing when to sell is just as important as knowing when to buy.
Right now is a very confident time to buy if you are willing to hold onto a lot for a long time.
Ethereum 2.0 and Proof-of-Stake for it will slowly roll out and those with the most Ethereum will reap the benefits first and in the most abundance.
With 10 Ethereum staking at 5% I would say that's a smart investment for something that only cost Jill $1161.60.
More ETH more rewards!
I went ahead and did some dream math for fun just to see how much Ethereum it would take in order for someone to earn 1 Ethereum a day for a year.
Assuming that we could stake Ethereum for 5%, owners of Ethereum would need to conjure up a whopping 7300 Ethereum to give themselves 1 Ethereum a day for 1 year. That's $116.16 earned every day just for holding 7300 Ethereum.
Psh, that's it?
...
...
...
If anyone had the money to do that right now it would cost them $849,731.48 USD.
Maybe that sucks, maybe it doesn't?
My take on the matter is that no matter what everyone should be making passive income in some way even if only a little.
Afterall, Melvin's 0.05 Ethereum gain after 1 year could look more like $30 or $50 USD.
It is also worth mentioning, these rewards are likely paid out in the same cryptocurrency. If these were to be deposited daily, weekly, or even monthly.
You would be gaining 5% on those assets once they are deposited!
Proof Cryptocurrency is doing fine:
Those of us looking for short-term gains might be disappointed by this one but the smart ones are in it for the long haul.
Continue to add more and more to your staking pool over time and it will start to increase the way you had hoped.
It just takes time and patience!
Ethereum may not be the best thing to buy up if you are expecting to make $100 a day doing nothing but holding.
Not very many people have $849,731.48 just lying around to make that happen...
Passive income should not be thought of as something that will allow you to not have to work for the rest of your life.
We all have to work some way or another!
Passive income should be thought of as a reward just like it is presented!
Passive income is more like a benefit you get for being good with your money.
In return you get small rewards that get bigger the more you decide to save.
In a way these small rewards help even out common daily expenses that add up over time.
Meaning you don't have to feel so bad for buying a coffee with the extra money you made one day.
Or maybe it is enough that you take your family out to eat somewhere nice!
Some people don't do anything and turn around and just keep it in their savings in case of emergency.
Whatever the case may be, it is certain that Cryptocurrency is still a thousand times better than what banks currently offer.
