Today will be a fantastic day because I get to talk about my favorite investment strategy, USDC. USDC is a stablecoin that trades on centralized and decentralized exchanges.
What makes the United States Dollar Coin great is that it bridges the gap between traditional finance (TradFi) and Decentralized Finance (DeFi). Today, I will explore why you should take your hard-earned USD and convert it into USDC.
Welcome back to the Crypto Investing 101 series (101, 102, 103). Here we start our journey into the world of cryptocurrencies, decentralized finance, and the Metaverse.
What if Your House Paid Dividends?
Your hard-earned money. We all work hard for our money; thus, we aim to protect it at all times. It’s tough to put our money into the unknown, especially when we don’t understand investing.
However, the most important rule we must remember is that each dollar should be working for us. When we receive $100, perhaps $25 should go to expenses, and the other $75 we should invest. EVERY DOLLAR COUNTS.
On a side note, the From Dirt to Dividends series (part 1, part 2, part 3, part 4, part 5, part 6) explains how to convert every $25 into a long-term high-yield investment. If you struggle to understand the concept of keeping every dollar working, please read this series.
TradFi vs. DeFi. Now that we have the mindset of investing each dollar, let’s compare our options in TradFi and DeFi.
Relationships in the Metaverse
With traditional banks, we have the choices of high-yield savings accounts, certificates of deposits, savings bonds, and US Treasuries. Not bad options to earn a small amount of interest (typically 2-4%).
We also have the stock market for those that can assume more risk. We have index funds, bond funds, dividend-paying stocks, growth stocks, and high-yield products on the stock market.
Moving into DeFi, we have similar options to invest our money. However, more opportunities are open to us with interest, lending, yield farming, and staking.
The idea of DeFi is to catch the new trends as they develop. Yes, it is risky in the decentralized space, but things will slowly begin to normalize.
The Magic of Passive Index Fund Investing
DeFi will lead directly into the Metaverse. These massive digital worlds will likewise need digital assets to fund the expansion of lands, population centers, and advertising.
Cryptocurrencies and NFTs will be the backbone of the Metaverse; thus, we cannot run from this blockchain future.
Enter the new world with stablecoins. If you don’t understand the larger picture of DeFi and the Metaverse, you still have options to invest.
Living Overseas on Passive Income
The first place to start is with stablecoins, ideally USDC. I recommend USDC because for every US dollar people invest; they mint a USDC digital coin. Theoretically, it grows 1 to 1 with US dollars.
I hear many people saying that cryptocurrencies hold no intrinsic value. That is a very first-world country thing to say or think.
If I lived in Turkey, and the Lira (the national currency) is inflating at 12%, being able to buy into a USDC would be life-changing. I could hold USDC and keep my money moving WITH the US dollar instead of against it.
For this reason alone, cryptocurrencies will allow billions of people to invest in US dollars at a time when uncertainty is running rampant.
Living Overseas Passively 109: Cash & Emergency Funds
Invest in USDC. The first step to investing in USDC is picking your platform. I always recommend Voyager (affiliate link) because that is the only way I invest in crypto.
There was a massive hit to stablecoins with the collapse of TerraUSD. This tragedy caused a run on stablecoins and perhaps the most significant stress test on stablecoins ever.
To ensure their long-term survival, Voyager has reduced the interest rate on many of their coins. It’s sad for income lovers like me, but protecting one’s business is essential to the plan.
Voyager currently pays 9% on USDC up to $25,000. I have $2,000 in USDC for now; I am pleased with this number. I am working on getting up to $5,000 by the end of the year.
Dollar-Cost Average to success. The best way to invest in USDC is to dollar-cost average into your position. I like to invest $250 at the beginning of each month.
The In-Debt-ured Servant
It is also lovely because I receive my interest payment on the 1st of each month. Last month my income was $14. This is a massive amount of money for only having $2,000 invested in USDC.
Invest in the future. USDC and stablecoins are crucial because they open the door to the future of DeFi and the Metaverse. You are essentially converting your national currency into a digital token you can use on anything in the future.
Once you get enough USDC, you can take out a trust-less loan against your stash (for leverage). You can also send it to peers instantly (at a high cost). If you see a crypto coin project starting to go FOMO, you can jump in with USDC.
Think of USDC as the national currency for crypto. Eventually, stablecoins will amount to much more total capital than even Bitcoin. The value of stablecoin coins and USDC is that they are neutral investments towards the future (almost like index funds).
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Conclusion. Turning your US dollars into USDC may be the most challenging part of investing in crypto. I recommend you start small. Invest $100 and watch your interest payments accumulate every month.
If you like what you see, then add another $100. Once you build this trust, you can make some serious decisions on allocating the resources in your nest egg.
The Metaverse, cryptocurrencies, and DeFi are the future of work, play, and finance. Nothing is going to stop these digital investments from coming to fruition.
You may as well dip your toes in the water with stablecoins. As your jobs transition to the Metaverse and lending becomes peer-to-peer, there will be nowhere to hide. So, it is time to invest in the best. Good Luck!
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Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
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