Finance Smiths

Personal finance apprentices-in-training

Participating in Crypto Earn and Supercharger on my Crypto.com account

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The cryptos market has picked up so I stopped the manual purchases on my Crypto.com account in the various cryptos I have decided to take positions in. Just going to be patient and wait for the next dip before I commit more cash funds into cryptos. The weekly regular purchases of LINK, LUNA, DOT, SOL and MATIC on my Crypto.com account over the weekend will continue for as long as I maintain sufficient USDC in it. I have now built up a minimum level balance in LINK, LUNA and SOL to use the Crypto Earn function.

Given that I do not have sufficient CRO to be staked to earn a higher interest, I went with the 3 month fixed holding term for my LINK, LUNA and SOL balance at the lower interest rate on Crypto Earn. It will take me a while to get to Ruby Steel card tier and even longer to reach Royal Indigo/Jade Green card tier (where I can qualify for the higher interest rate). This is a new cryptos platform for me after all and it would take me time to build up a larger portfolio in my account. The aim is to eventually increase the size of the position to a similar one as the crypto holdings on my Hodlnaut and Cake DeFi accounts.

I received an email alert about the latest Supercharger Event (ETH) on my Crypto.com account. This came at a good time as I was exploring this function and wondering what I can do with my small CRO balance. I staked all of it in the pool and will wait for the rewards to be allocated after the charging period for this event is over. I even checked out the Missions – Rewards Program where I can complete daily missions to earn diamonds and use them to redeem rewards such as mystery boxes. It seems like I’m getting more active on my Crypto.com account just because of the different ways I can earn more cryptos in one app.

When it comes to cryptos, I take a similar approach as what I do with ETFs and stocks. Find a convenient way to invest even if it costs more, whether it be paying higher management or transfer fees. My gains may be lower over time but sustainable with regular capital injections and a large enough account balance. Taking a convoluted approach to generate higher returns on cryptos is just not something I can afford to do now. It has to be fuss-free with minimal monitoring for me to be consistent. This also allows me to hold through bull and bear market cycles without panicking over what I should be doing at every stage.

Buying the dip in the cryptos market

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This is how volatile the cryptos market is. Just last week, I was writing about watching my crypto holdings on Hodlnaut (BTC and ETH) and Cake DeFi (DFI) hit new highs. Even my regular purchases on Crypto.com (LINK, LUNA, DOT, SOL and MATIC) were also in gains. In the last few days, that high is all gone now. It’s to be expected from the cryptos market and why I don’t trade it. Leveraged cryptos traders with long positions would have been liquidated given how quickly the market dropped in such a short time.

My investment strategy for cryptos is to mostly buy large caps regularly over time and hold for the long term – generate higher crypto interest and lower capital gain. And buy lesser amounts of small caps when the opportunity arises and hold again for the long term – generate lower crypto interest and higher capital gain with the potential for higher staking rewards. It’s not complicated but difficult to execute consistently given how fast-moving the cryptos market is and trading occurs 24/7. Meaning big movements can be happening while you sleep.

With the recent dip in the cryptos market, I have been swapping my stablecoin (USDC) holdings on Hodlnaut into BTC and ETH as the prices dropped. Not big amounts but 50 to 100 USDC at a time. On my Crypto.com account, I have been initiating small purchases (using USDC after transferring in XSGD to buy it) of a variety of cryptos (such as XLM, BNB, ADA, LTC and XRP) outside of my regular purchases (LINK, LUNA, DOT, SOL and MATIC) as the prices dipped. Using even smaller amounts of 10 USDC at a time.

While the value of my cryptos portfolio has gone down, the number and amount of crypto holdings has increased. This is an opportunity for me to accumulate more of the cryptos I have been monitoring for a while now. It’s possible for the prices to drop further so I’m in no rush to commit more of my cash funds. In any case, I’m running out of investing cash as I was averaging down on Paypal and Disney. And regular contributions to my various investment plans with robo-advisors and banks continue to drain my cash.

My salary income is mostly used up and I’m waiting for my wife’s salary income now for the top-up. I have a big credit card bill payment due around the same time so it’s going to be close as to whether I have enough cash to pay it off on that day. It’s like my cash level is on survival mode because I’m not used to investing this much every month. But I’m pushing for it to increase more quickly to get my buffer in place. I would probably be in a more comfortable position by end Dec after my wife’s bonus is credited. Just more breathing space to not worry about paying for expenses and invest at the same time.

Monitoring my main BTC, ETH & DFI cryptos position and managing emotions in a bull or bear market

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I’m happy that Singapore is easing some of the Covid rules from Wed 10 Nov onwards. Mainly on allowing up to 5 fully vaccinated members of the same household to dine out at F&B establishments. It’s not a big step forward but I’m good with even a small step in the direction of further relaxation of the Covid rules. Feels like it has taken such a long time for us to get to this point. Maybe it is the mental fatigue taking its toll but the situation just feels more difficult and frustrating this time around. Even focusing on our daily routine to get through the week is proving tougher than usual as we are unable to significantly vary the activities that can be done together as a household or with our families and friends.

Anyway, the past few days of price rally in BTC, ETH and DFI have increased the value of my main cryptos position in Hodlnaut and Cake Defi. I was surprised because I didn’t think the price action would happen so soon and in such a short amount of time. For my other cryptos position in LINK, LUNA, DOT, SOL and MATIC on Crypto.com that is much smaller, I had only just started the regular purchases over the weekend and they are in gains as well. This reaffirms my belief that trading cryptos is not the way to go for me in the long run. I tried doing this the last time and got burnt by the previous bear market in the middle of this year.

It seems like consistently buying and holding cryptos that have long-term potential yields better results than trading these cryptos. My goal is to build up this asset class in my investment portfolio, just like what I did with ETFs initially before moving onto individual stocks. I’m not going to abandon the traditional financial markets of ETFs and stocks as I continue to maintain my weekly purchases in equities. At this time, 30% of my monthly Dollar-Cost Averaging (DCA) amount goes into cryptos, another 30% is for index ETFs and the remaining 40% goes into thematic ETFs. A previously passive DCA approach is gradually becoming more active as I seek higher returns even with my weekly regular purchases of financial assets.

I’m not so brave to go all-in on cryptos as I’m still learning about them. I rely heavily on online research done by other people and their recommendations before deciding which ones to take a position in. Then taking even more time to choose how much and in what manner I should commit my capital. While I admit the potential returns from cryptos are far greater than ETFs and stocks if I can make the correct selections early on and hold through the volatility, it also means I have to deal with stomach-churning rollercoaster rides of emotions more often. I can see people getting excited about their gains from the cryptos bull market now and I have benefited from it as well. But is this euphoria the start of something even bigger or the beginning of something worse.

It’s important to manage my emotions in either a bull or bear market. Just like how I have been averaging down on Chinese tech stocks for a while now and still waiting patiently for the recovery to kick in. And continuing with my regular contributions to StashAway even though I know the KraneShares CSI China Internet ETF (KWEB) in the general investing portfolio is causing most of the underperformance compared to other robo-advisors. I’m counting on this underperformance now to drive higher returns in the future. I’m not going to stop buying into underperforming markets just because their returns are bad in the short to medium term.

Likewise, my pivot into US tech stocks and cryptos earlier in the year paid off with overperformance. But I’m not going to divert all of my cash funds there even though it’s possible that they can continue to go up and generate much higher returns than a recovery in the underperforming markets. FYI, I’m still buying the STI ETF every month even though it’s one of the most looked down upon investment action that can be taken by a financial blogger. I freely admit doing this because of its stability and I feel like betting on Singapore’s future and growth. I have no idea what is going to happen next. But I know I’m going to make good and bad calls along the way. And I just have to ride every bull or bear market with what I have learnt from the previous one.