I currently get "paid" 80% in Bitcoin and 20% USD via Strike. All my Bitcoin goes into cold storage and the USD goes towards bills.
I currently keep 3 months of income in USD as an emergency fund/savings account, just in case but most my money is in Bitcoin. These funds are parked in River and making interest paid in Bitcoin, at this time it's 3.3%. It's easy, I like it and it's stacking me some extra sats.
Here's my idea,
What if I put this emergency fund into Fidelity and bought STRC? STRC pays 11.5% currently, stable at $100, and is tax differed. Then I would use the 11% dividend paid monthly to buy Bitcoin every month by sending the dividends to River or Strike and DCA into bitcoin for much more Fee-less Bitcoin purchases.
Once a month my Bitcoin would be moved to cold storage for free.
Thoughts in this plan?
Savings/Emergency funds idea to stack more Bitcoin.
byu/_Carth_Onasi inbtc
Posted by _Carth_Onasi
5 Comments
Did we all not learn from FTX and Voyager?
Where’s your Bitcoin?
Have you tried making a withdrawal?
So many job and coin scams out there… I fear for the welfare of anyone who is getting paid in Bitcoin.
Maybe I’m overly cautious but it could take longer than 3 months to find good paying work so maybe you could focus on 6 to 12 months worth of emergency fund.
Maybe not and just cash but something like the s&p 500, Gold, or Google but even that subject to lose a lot of value if the market crashes but if you end up not having to use it then it could be another way to store value without it being in just Bitcoin.
I know some people go completely all in but I can’t help but to think that it’s not a terrible idea to have something that’s not Bitcoin to give you some coverage in case there’s some type of black swan or rogue developers or something we don’t foresee that hurts Bitcoin for an extended period.
What do y’all think? Am I being overly cautious or prudent?
STRC pays 11% yearly. But look at their filings and the documents related to those financial products. They are in no obligation to pay any dividends. Also they can, legally, change the amount as they like. Even skip a few payments entirely.
Look at what that means. Imagine most customers get in and stay in because those dividends look so great. Then they have to pay you back your money in interest after roughly nine years.
So the bet is that there will always be more new customers bringing in money than they have to pay back to existing customers. That is literally their only revenue, musical chairs. But as they are honest about not having to pay its somehow legal.
Imagine you have your emergency fund in there, which by the definition of an emergency fund would be a bad idea. As soon as they Touch the payment amounts or skip an entire month of payments, everyone will be running to the door. And then you dont get any more dividends as there is no more money, nobody else will buy the initial shares of you, so that money will be gone as well.
There is a reason that the rating for their schemes ist in the lower end of things because they are not only risky, but sometimes not even barely sustainable in the medium to long term at best.
All custodial, you gotta pray that they don’t fuck with you or go belly up.