Surviving The Market When You're Paid In Crypto
Updated
ETH/USD - Coinbase
Disclaimer: This is not financial advice and not a good speculative strategy. On the contrary, it's simply a "how to survive" strategy that is still not perfect and changing all the time. However my underlying chart and thinking has largely kept me safe from any MAJOR losses (knock on wood). I also drew this trend line several years ago. This base level trend has stayed in tact so I continue to use it as is.
This is an entirely neutral strategy intended to ensure you don't get "Rekt" when you make a full time living paid in a volatile currency. For me, all crypto has always been money. I have paid my rent in crypto, got paid in crypto, used crypto debit cards, and never use a bank outside using credit or loans. Banks are obsolete to me as soon as DEFI based credit is more mature.
This is not a perfect model and I'm still learning, making mistakes, and figuring out how to navigate this new financial reality every day.
Back Story
First a little back story. Since 2013 I have made a part time living on Crypto and since 2015 I have made a full time living paid in crypto. After taking a position at Coinbase doing Operations and Regulatory Compliance in 2015, I quickly began to adapt to this new all crypto life style. I'm now with district0x and have continued this journey even deeper. This required some hard lessons and exciting prospects. I have now been paid in DAI, BTC, ETH, Silver, NFTs, and every now and then other random assets. Volatility is life. 😎
The Nitty Gritty
The hard lessons ranged from, how easy it is to lose access to your crypto (Ouch 🤮), the market taking a nose dive right after payday because I forgot to move my money (📈📉), not to mention all the fees and costs associated with open finance and exchange. I quickly developed a significantly conservative outlook on my money management. I learned how to somewhat stabilize my income from volatile shocks in the market but I look at the losses as tuition paid for my education. A tough thing to swallow but so much cheaper than university. 🤷♂️
Basically I would live on Credit cards for the month, then cash out my earnings when the market was around the price I was originally paid so I can pay off credit cards. This was by no means perfect but my chart has never changed the entire time I have been in crypto.
I mapped out the base level uptrend and ignore all the bubbles. If I'm at the top or above the main trend channel I would cash out my checks and not rely on credit. If the market is on the lower end of the channel I would hang onto my pay. These days if I decide to keep some money in the market I ensure I have about half stable value and half BTC or ETH. This way if the market moves up, I have some and if it dips hard I can grab some more.
I also keep an eye on the long and short positions as well as overall volume using the paid indicator VPVR. If I'm paid in the middle of a liquidity gap I would immediate move money to a stable store of value like USDc, my bank account, and sometimes a DEFI app.
If I'm in a zone where the liquidity gap is filled in, creating support on the lower half of the channel, I would leave it. I have had the market fall losing a large part of my check but considering the market is in a milti year uptrend on the base level of liquidity, I just hold it until I have my pay back. Not ideal but it's worked for me as long as I'm patient, cautious, and conservative with my decisions.
While this is a neutral strategy, I do intend to go long depending on how the market moves but I am going to keep my crypto and stable coins at a 50/50 ratio for now so I can be okay with whatever direction the market moves.
Future plans
I will be using my stable coins to move into crypto if the market corrects back down to the lower half of the long term trend (Which it likely will). I will slowly scale into ETH and BTC as it hits the high volume zones and if the liquidity gaps fill in.
Usually if a gap fills, it becomes a major level of support or resistance so they make good points to scale in with any stable coins you have. I won't scale in until is hits the red line in the center of the uptrend. Then I will use 10-15% below the median range, another 15-25% if it drops to a lower range, 25-50% if it dips lower, and if we have a hard spike down into the lower blue channel, I intend to to go all in.
Anything above the base level channel I will likely be selling because "Sell when others are greedy, and buy when others are scared".
I will use a similar "scaling out" strategy like my "scaling in" strategy if we see another bubble. Considering I work in the industry I really am not a fan of the bubbles. It makes the networks more expensive, harder to use, and vulnerable to forks and other technical or political issues that makes development more difficult. I look at it like this, if one network inflates beyond usability, I get free money to apply towards another network I intend to also use as load balancing. I also can't wait for more solutions like Cosmos and Polkadot. Multi chain transactions are the future, especially if bitcoin and ethereum are so expensive only businesses can afford to use them.
Stay grounded when everyone starts to fly. The moon is a lie and made of cardboard and cheese 🧀📦
Developers are the new rock stars and the Dapps are the future of finance that we all should be using.
USEL don't HODL... 😎
Disclaimer: This is not financial advice and not a good speculative strategy. On the contrary, it's simply a "how to survive" strategy that is still not perfect and changing all the time. However my underlying chart and thinking has largely kept me safe from any MAJOR losses (knock on wood). I also drew this trend line several years ago. This base level trend has stayed in tact so I continue to use it as is.
This is an entirely neutral strategy intended to ensure you don't get "Rekt" when you make a full time living paid in a volatile currency. For me, all crypto has always been money. I have paid my rent in crypto, got paid in crypto, used crypto debit cards, and never use a bank outside using credit or loans. Banks are obsolete to me as soon as DEFI based credit is more mature.
This is not a perfect model and I'm still learning, making mistakes, and figuring out how to navigate this new financial reality every day.
Back Story
First a little back story. Since 2013 I have made a part time living on Crypto and since 2015 I have made a full time living paid in crypto. After taking a position at Coinbase doing Operations and Regulatory Compliance in 2015, I quickly began to adapt to this new all crypto life style. I'm now with district0x and have continued this journey even deeper. This required some hard lessons and exciting prospects. I have now been paid in DAI, BTC, ETH, Silver, NFTs, and every now and then other random assets. Volatility is life. 😎
The Nitty Gritty
The hard lessons ranged from, how easy it is to lose access to your crypto (Ouch 🤮), the market taking a nose dive right after payday because I forgot to move my money (📈📉), not to mention all the fees and costs associated with open finance and exchange. I quickly developed a significantly conservative outlook on my money management. I learned how to somewhat stabilize my income from volatile shocks in the market but I look at the losses as tuition paid for my education. A tough thing to swallow but so much cheaper than university. 🤷♂️
Basically I would live on Credit cards for the month, then cash out my earnings when the market was around the price I was originally paid so I can pay off credit cards. This was by no means perfect but my chart has never changed the entire time I have been in crypto.
I mapped out the base level uptrend and ignore all the bubbles. If I'm at the top or above the main trend channel I would cash out my checks and not rely on credit. If the market is on the lower end of the channel I would hang onto my pay. These days if I decide to keep some money in the market I ensure I have about half stable value and half BTC or ETH. This way if the market moves up, I have some and if it dips hard I can grab some more.
I also keep an eye on the long and short positions as well as overall volume using the paid indicator VPVR. If I'm paid in the middle of a liquidity gap I would immediate move money to a stable store of value like USDc, my bank account, and sometimes a DEFI app.
If I'm in a zone where the liquidity gap is filled in, creating support on the lower half of the channel, I would leave it. I have had the market fall losing a large part of my check but considering the market is in a milti year uptrend on the base level of liquidity, I just hold it until I have my pay back. Not ideal but it's worked for me as long as I'm patient, cautious, and conservative with my decisions.
While this is a neutral strategy, I do intend to go long depending on how the market moves but I am going to keep my crypto and stable coins at a 50/50 ratio for now so I can be okay with whatever direction the market moves.
Future plans
I will be using my stable coins to move into crypto if the market corrects back down to the lower half of the long term trend (Which it likely will). I will slowly scale into ETH and BTC as it hits the high volume zones and if the liquidity gaps fill in.
Usually if a gap fills, it becomes a major level of support or resistance so they make good points to scale in with any stable coins you have. I won't scale in until is hits the red line in the center of the uptrend. Then I will use 10-15% below the median range, another 15-25% if it drops to a lower range, 25-50% if it dips lower, and if we have a hard spike down into the lower blue channel, I intend to to go all in.
Anything above the base level channel I will likely be selling because "Sell when others are greedy, and buy when others are scared".
I will use a similar "scaling out" strategy like my "scaling in" strategy if we see another bubble. Considering I work in the industry I really am not a fan of the bubbles. It makes the networks more expensive, harder to use, and vulnerable to forks and other technical or political issues that makes development more difficult. I look at it like this, if one network inflates beyond usability, I get free money to apply towards another network I intend to also use as load balancing. I also can't wait for more solutions like Cosmos and Polkadot. Multi chain transactions are the future, especially if bitcoin and ethereum are so expensive only businesses can afford to use them.
Stay grounded when everyone starts to fly. The moon is a lie and made of cardboard and cheese 🧀📦
Developers are the new rock stars and the Dapps are the future of finance that we all should be using.
USEL don't HODL... 😎
Note
I should mention that I am currently paid in ETH so I ignore the BTC chart beyond looking at the longs and shorts to get an idea of how much pressure BTC is placing on ETH.This just gives me an idea if BTC is going to gain momentum or not. Which does change my strategy a bit but for the most part I still am neutral, so it doesn't really affect me much.
I also have no real use for BTC because the network is so slow and expensive. So I have a much smaller amount of BTC until there is a real use case built on the BTC network beyond speculation and ideologically driven payments and savings.
If I can't actively use a technology I tend to not hang onto it. I have a similar stock investment strategy where I only buy what I personally use and understand.
Disclaimer
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