The Secret Behind ‘Set It and Forget It’ Crypto Investing Hacks
The biggest obstacle to investing is the investor — the fear of loss makes people invest conservatively, while greed prevents investors from realizing profits following a substantial market uptrend
A. Solano/Shutterstock.com modified by Blockworks
There were key moments during the last bull market that skewed people’s ideas of a reasonable return. For those with more conservative investment strategies, it was hard to log onto Reddit and see dozens of users posting +300% gains on the day after chasing the latest short squeeze or the dead cat bounce of a failing retailer’s stock. Without a doubt, these days were the hardest for some investors to sit on the sidelines and stick with their more conservative investment plans.
They knew that these kind of returns were unsustainable and so they stuck with automated investing — a strategy that lets investors “set it and forget it.” Automated investing enables people to automatically put away a portion of their earnings into investments that generate sustainable growth over time. While it may not put anyone on the front page of Reddit, this is a remarkably consistent path to growing wealth.
The massive adoption of 401(k) accounts and similar retirement savings plans in recent decades reveals the benefits of automated investment strategies. In fact, there are an estimated $7.3 trillion worth of assets held in 401(k)s by 60 million-plus US employees. Yet, the 401k’s long-proven automated strategy is largely inaccessible to most investors due to a lack of financial education and tools required to tap into it.
Thankfully, the emergence of blockchain technology and cryptocurrencies is changing this. These systems’ digital and permissionless nature give people the ability to build wealth through automated investing. It’s also given rise to several new crypto-investing hacks ranging from automated salary payments in bitcoin to earning crypto credit card rewards through apps like Curve.
This article dives deeper into why automation works as an investment strategy and the numerous crypto-investing hacks currently available to investors. It also reveals how companies like Curve empower users to tap into automated crypto investing through their credit card.
How automation provides the key to sustainable wealth building
The biggest obstacle to investing is the investor. The fear of loss makes people invest conservatively, while greed prevents investors from realizing profits following a substantial market uptrend. Both of these emotions can derail an investor’s future and ultimately prevent them from reaching their objectives.
In a classic example, greed causes investors who try to time the market to miss the market’s biggest gains. A Putnam investment analysis found that an investor who kept $10,000 in U.S. stocks over a 15-year timeline would make $24,753 more than someone who missed the market’s best ten days by trying to time it. It’s statistics like these that prove the famous adage, “time in the market beats timing the market.”
An automated investing plan is an ideal antidote to fear, greed, distraction, and, perhaps worst of all, shiny-object syndrome. When money is automatically deducted from their paycheck or bank account, an investor is more likely to hold appreciating assets for the long term.
Blockchain technology and cryptocurrencies bring even greater solutions to automated investing than those offered in the traditional financial system. The underlying technology enables near-instant payment settlement and transparency. At the same time, the crypto industry’s immense potential means investors that choose blockchain-related automated investing are also tapping into a market that historically outperforms other asset classes.
Automated investing through crypto apps
“The near $1 trillion cryptocurrency market provides notable automated investing hacks for investors. The most popular examples include tools that allow users to convert a portion of their paycheck into Bitcoin, as well as automated dollar cost averaging (DCA) features on different exchanges.
Users can tap into decentralized finance (DeFi) protocols that support automatic reinvestment of staking rewards and more recently, the option to earn crypto credit card rewards through services like Curve. The Curve Credit Card offers 1% back in crypto with every swipe, giving users ten currencies to choose from including bitcoin, ether, and cardano.
The greatest advantage of automated crypto investing solutions is that investors build holdings in the top cryptocurrencies without worrying about their entry price. Unlike lump sum investments, automated solutions typically support weekly and monthly DCA purchases and compound profits. It also protects investors from distractions since the amount is automatically deducted from associated accounts and invested on their behalf.
Another benefit is that such strategies free investors from tax headaches linked to regular crypto trading. Since the income is only taxed when the investor sells or exits a portion of their position, it becomes much easier to calculate the taxable value.
However, there are risks beyond the obvious volatility associated with crypto assets. One of the most prevalent risks is that some automated crypto investing platforms make it difficult or impossible to self-custody, instead encouraging users to store funds on centralized platforms. These platforms offer additional rewards and emphasize the convenience for customers to store their assets on the given exchange. The recent collapse of centralized exchange FTX is a perfect reminder of why investors must remain wary of platforms discouraging self-custody.
Automated crypto investing solutions like Curve implement a new feature that enables users of its crypto credit card program to take custody of accumulated rewards into their own wallets. Such an innovative feature adds to Curve’s unique strength as a leading crypto credit card service and provides greater value to users.
Crypto credit cards
A credit card that pays out rewards in cryptocurrency is one of the simplest hacks for continuously accumulating cryptocurrency assets. As teased above, cards like Curve’s work just like other rewards credit cards, with the primary difference being that they pay out cashback rewards in assets like bitcoin and ether. From there, users can choose to withdraw or store the earned crypto in the wallet of their choice.
Despite the huge opportunity posed by crypto credit cards, adoption remains relatively low. The current earnings systems implemented by most crypto credit card companies are clunky and hard to manage. The reward options are often limited, while the process of redeeming earnings is overly complex.
The Curve crypto credit card reward system lowers these barriers- just swipe the card and get crypto.
But what really makes the Curve card unusual is that it allows users to combine their existing credit and debit cards into the Curve App. So when they swipe their Curve card, they’re receiving not only a fixed 1% crypto-back reward, but the points or cash back they’d normally receive with that third-party card.
Since the Curve card combines multiple credit cards into one, their algorithmic Smart Rules system determines the optimal credit card for each purchase based on rules the user sets. For example, they could select whichever credit card is best optimized for grocery store purchases to trigger anytime they swipe their Curve card at Kroger. They would receive the maximized cash back from the underlying card and then Curve’s 1% crypto-back reward on top of that.
Finally, Curve has developed their Go Back in Time feature that allows users to move transactions to different cards up to 30 days after the original purchase. This can avoid embarrassing and costly mistakes like using a company credit card on a personal expense.
Supercharge your crypto cashbacks with Curve
Automated investing is a proven strategy that, while simple to set up, delivers outsized results over time. Even a $100 investment monthly allocation into a relatively low-risk index fund with an average 8% annual return would yield $95,103 after 25 years.
With history as a guide, the cryptocurrency market has historically appreciated much more than 8%, and credit cards like Curve expose users to crypto without any upfront costs. Since these rewards are on top of other credit card points and cash back programs, it’s a truly risk-free and simple way to participate in the powerful wealth-building exercise of automated investing.
This content is sponsored by Curve.
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