Growth or Income?


bitcoin chartWith Bitcoin prices reaching as high as $6,150 last week, the debate continues on how to best capitalize on the growth. We aren’t here to tell you what to do, but we’re happy to give you our insights into the pros and cons of options available.

We started our Bitcoin investment in May 2017, and we are now (21 Oct) up over 150% for the year to date. That’s mind-boggling! We’ve said before that we are not buyers and holders of Bitcoin. But we know lots of people who are. So, who is right?

The answer depends on your own goals. Just as in any other investment, if your goal is to accumulate wealth, you might want to just buy as much Bitcoin as you can afford (remembering our cardinal rules) and hold on for the hoped-for rise. But things get a little more complicated if you are wanting to use Bitcoin as a way to develop an income stream. In this case, you have to seek out the programs you think best fit your own goals and sign up for some of those.

These usually fall into 2 categories: mining or loans. The mining packages sell you “hashpower” (Think of it as how fast can you dig up those Bitcoins?) to give you the highest yield you can afford to buy. We signed up for one of these early on for a total net cost of about $2,500, and it is currently paying us about $18 a day, every day, without a hiccup. Currently we are into 3 of these kinds of programs, Swiss Gold Global, Omnia-Tech and Dragon Mining/Lifestyle Galaxy (not currently available in the US). The other way to generate returns is through loans. These companies offer programs that do various background activities (mine Bitcoin and/or other cryptocurrencies, investing in Forex and FIAT currencies, hedging with arbitrage and other highly technical methods) to increase their yields and pay you daily interest on these loans. Some can be quite high, so be careful – remember the general rule: if it sounds too good to be true, it probably is! You can read more about these and our opinions of them in our recent post, “Our Bitcoin Adventure Continues“.

A further income generator is by referring others to these programs. Most of them will pay you for anyone who signs up under you without having to even join, while some require an additional fee to be an “affiliate”. Some of the links on this site are affiliate links, so if you sign up from them, we’ll get a little override on your purchases. (Thank you in advance!) It isn’t much, but the more who sign up, the faster things add up. And if you are an experienced network marketer, the returns can be really, really good!

So, how have we done? We’ve mentioned that we had some good programs and some flops. Managing a strategy to grow for the sake of income can be time-consuming. And in all honesty, as of this point we are ahead of simply buying and holding by only about 4.5% since we started. And that is with some affiliate related income, so you might say that we are about even with a lot more effort.  However there is another thing to consider: safety.

If you believe the Bitcoin is going right to the sky, this may not be important to you, but we’d rather ride the fence a bit and pull profits out regularly.  As the bitcoin grows, the programs are automatically more lucrative, and we can pull out more.  As we convert back to cash, we are still benefiting from the rise in value, but we are also maintaining more safety by not holding large amounts of Bitcoin in our accounts. Kind of like reverse dollar-cost-averaging.  We consider it like insurance.

Finally, I have to say personally that I enjoy looking at all these programs and learning how they work. I have always loved technology and usually stay pretty close to the bleeding edge, so I don’t mind “fiddling around” a bit – it’s kind of a game. But for us, the extra level of safety makes it worthwhile. Your situation may be different – it’s your choice.  Just say safe and have fun!

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