Crypto Mindset & Perspective: How Thinking Shapes Your Results
When you really start to examine crypto success stories that were calculated, in other words, the individuals involved actually set out to succeed. You begin to see how much a person’s mindset and perspective can either enhance or limit their progress. Essentially, crypto is an investment, but it can also be a form of business ownership. Another way to think of a mindset is a view. For instance, a person who believes crypto is risky or a scam is ultimately hindered from ever experiencing any success in crypto.
His mindset and preconditioned views will not allow him to take part. Essentially, he requires factual data to convince him otherwise and, hopefully, change his mind. This is obviously an extreme case, and yet, milder scenarios exist even within the realm of crypto enthusiasts. To participate in the crypto economy, you will require conviction. Your decisions will be tested at some point. This market can also be extremely harsh at times.
I have spoken before about how a person with a strong leaning towards investing is not like others. He views things differently and is often quite creative in his thought processes, strategic planning, and risk management. Being averse to risk and lacking patience are two traits fundamentally opposed to entrepreneurship. This article proposes buying a coin with passive-income mechanics as an alternative to starting a small business. So let’s look at this and consider why so few actually think this way.
The Average Cost To Start Your Own Business
When you look at starting your own business, you don’t want to be laying out wads of cash but would rather invest in a startup that would hopefully bring in a decent income, especially when compared to the initial cost to set it up. On average, the cost to get a startup off the ground is in the region of $30K to $35K. What you have to consider is that, although you put in the capital and get your business going, it does not necessarily guarantee success.
A rather scary statistic reveals that approximately 90% of startups fail. Though some may persist for several years, they ultimately fail. So, unless you are exceptionally talented, your chances are not that great. In the event of failure, you can pretty much kiss that initial investment capital goodbye. You may also have accumulated a heavy debt burden while trying to keep your business alive. Another important point to consider is that startups are usually owner-managed and run on a day-to-day basis.
In essence, you don’t really have a business working for you; you are actually working for your business, just as an employee works for a boss. In fact, you will likely work harder, since it now directly affects your bottom line! So if it doesn’t work out for you, not only are you worse off than an employee, but you’ve also lost $30K and may have incurred further debt.
Is A Crypto Coin Like A Business? Understanding The Risk Behind The Value
Now, let’s look at another alternative: acquiring an altcoin as a business. Before we continue, we need to remember that even if a startup succeeds, it still needs to be established over time. Profits will increase slowly, as stability and reputation continue to strengthen. Similarly, you need to consider that this idea will require time. It will also require a certain amount of talent and knowledge regarding the crypto space. Why do I say that?
Well, this idea becomes extremely powerful when the coin of choice is still fairly under the radar but has a decent staking reward. I am using the practice of staking in favor of DeFi to minimize risk. The lending avenue will not work well because most of the coins in this sector are already fairly large players. In other words, the market caps are quite high, which reduces growth potential.
Let’s Reduce The Risk
Instead of putting up $30K, let’s consider a very modest $ 10K investment. I say modest because one needs to remember that we are talking business-sized investments. We are also reducing the risk because no personal effort, work, or input is required. Starting a business from scratch is no easy task. I am going to use 2 different coins as examples to show how powerful this idea is when done right and well executed. Firstly, let’s look at Fantom. In early 2020, FTM traded at approximately a cent for quite some time.
Let’s consider that you decided to buy FTM at approximately $0.05 after seeing it deliver a 500% return, and knowing that it was a staking coin made it an even easier call. The beauty of a staking coin is that it will continue to generate rewards going forward. The average APR on FTM is approximately 10%, which is fairly healthy. Purchasing FTM at $0.05 would imply a holding of 200K FTM. I will not refer to ATH prices but rather to the current valuations at the time of writing.
Currently, 200K FTM is worth $514K and yields an annual reward of $ 51,400! This amounts to a monthly reward of $ 4,283 with zero effort. At the current price, you would recoup your initial investment every 2.5 months! Your modest $10K investment would now be worth over half a million dollars, and you would have a monthly disposable income of $ 4,283.
Let’s take a look at Solana. SOL traded at very low levels for many months in early 2020, and once again, let us add another 500% on top of those levels for good measure, so that we are not looking at a perfectly timed scenario but a more realistic one. Let us consider that you didn’t purchase SOL at the lows in early 2020 but rather at $1.50 in early 2021!
This would equate to 6,666 SOL, which, at current prices, would be worth $1.16 million. At an approximate APR of 7%, the annual reward would be $81 666! This would generate a monthly income of $6805! These are not even perfectly timed scenarios. I have added 500% to the low levels these coins traded in early 2020. If you know what you are doing and have a fairly good eye, it is not that difficult to spot these projects.
Final Thoughts
When you look at this objectively and dedicate time to research and identify what could work well in a year or two, only then can you consider buying a coin as a business for tomorrow. Remember, the percentage is coin-based, not dollar-based, so as the value rises, the return does not diminish but increases. Crypto is also an ownership model. This is how you have to begin thinking if you are not already thinking this way. Thanks for taking the time to explore this investment idea with me.