How to get a Cryptocurrency to sponsor you – beginners guide.
Over a month ago, together with my girlfriend, we went for a few days to El Hierro Island to visit our friends. Trips like that would not be possible without the passive income profits that support our budget. In this short article I wanted to show you how to start building safe passive income by taking advantage of proof-of-stake coins like DIVI.
Let’s dive into it right away and see how you can get constant sponsorship money pouring into your wallet.
We have to start with understanding how this is even possible.
I assume you already know that in order to verify the blockchain’s true state Bitcoin is using the proof-of-work (PoW) consensus mechanism. Proof-of-stake (PoS) coins use a different consensus method – a Proof-of-Stake. Instead of mining, the PoS blockchain nodes stake their native cryptocurrency to secure the network and validate transactions. This consensus mechanism was developed to tackle high energy requirements of bitcoin’s PoW mechanism and to allow better scalability. In PoS networks the stakers determine the amount of the native currency they want to lock up to become their ‘stake’ in the network. Each new block carries a reward (just like each bitcoin block has a coinbase transaction that rewards the miner) that is distributed to the nodes according to their stake. The more coins you have locked up for staking the higher your chances are of getting a reward. If you want to learn more about how different consensus mechanisms work (and about blockchain in general) I encourage you to check out my book.
There are few things I really like about PoS coins:
- Some of them are super easy to set up (like DIVI)
- They are super safe in comparison to other passive income tools (like yield farming)
- In most cases you always have access to your assets (unlike when you keep them on centralised exchange)
- Some of these projects are great platforms with a lot of potential for future price appreciation
The best, hassle free way to build your position and start enjoying a nice income stream is to use dollar cost averaging (DCA) when buying your PoS coins. Using DCA means that you buy an asset in regular time intervals, always with the same dollar amount (you can learn about DCA in my book).
Let me show it to you by taking DIVI as an example.
For over a year, from January 2019 to May 2020 the price of DIVI oscillated between $0.003 and $0.015. Just imagine: if during this time you bought DIVI for around $250 a month, after a year you would have a Silver DIVI Masternode (that cost you in total around $3,000). With today’s (July 2021) DIVIs prices of 4 cents, that Silver Masternode that you paid $3,000 for, is now worth over $12,000 and brings you around $200 worth of rewards a month. This is over $2,400 of yearly passive income from a $3,000 investment, which translates to over 80% ROI, and this is just from the extra rewards (you would also make $9000 on price appreciation!).
DIVI is only one of many interesting PoS projects on the market though.
Other great projects that I am heavily invested in are Solana and Ethereum (Ethereum is not technically a PoS coin yet but it will become one with the implementation of ETH 2.0 and I want to accumulate as much of it as possible before this happens).
Let me know in the comments below what is your favorite PoS coin, and if you want to learn more about blockchain make sure to check out my book.
Thanks for reading!
I help you to understand how blockchain works, guide you to first profits & share tips about how to create passive income by investing in crypto!