Hello Reader,
I’m going to list below some crypto resources that I have been using for the past couple years. Some are more recent than others but overall they have an excellent user experience. At the bottom of the letter I will link these platforms/services as well as some advice on allocation.
Exchange #1 - Shakepay
Shakepay is idiot proof. You e-transfer money into your account and then exchange it into either Bitcoin or Ethereum. You can also add funds using wire, BTC and ETH. Their prices incorporate a spread, which is how Shakepay makes their money.
For beginners, here is an example of a spread.
BTC spot price is $60,100. On Shakepay it will show up as $60,300 or something similar.
A nice thing is that when taking your coins off the exchange, Shakepay covers the transaction fee.
The Shakepay App also acts as a hot wallet. This just means “ease of liquidity” i.e you can sell/transfer your positions right away incase of an emergency. When your coins are on a cold-wallet (I’ll explain below) it takes a bit longer to sell/transfer your position because of the added security measures.
Note: Shakepay only lets you buy ETH or BTC.
Exchange #2 - OkCoin
I started using OkCoin when I wanted to expand into other cryptocurrencies and yield farming. For example, I currently earn 10% interest on my Stacks which is paid in Bitcoin. An abundance of lending rates exist (I’ve seen some as high as 430%).
You can also purchase BTC & ETH on the platform so it is not limited to the alt-coins.
Note: It’s wise to have accounts with different platforms to engage in price arbitrage, lending and security measures.
Lending Platform - Ledn
I’ve been using Ledn to earn 6%+ interest on my BTC. They also offer 9%+ on USDC (USD stable coin). You can also double your BTC with their loan program or put up your BTC as collateral. I haven’t had the need to do this yet but it is an option that is available. This is a Toronto-based company, hence why it’s a great option for Canadians.
Note: The interest is compounded, which makes for excellent gains!
Wallet #1 - Trezor Model T
A crypto wallet is one of the most important things you need if you want to hold any of your coins safely. You cannot leave all your coins on an exchange (hot-wallet). The beauty of cryptocurrency networks is that you can take ownership of your coins.
What do I mean? Here’s an example.
Right now, a majority of your money is probably in a bank account. If you go onto your online banking, you’ll see your chequing/saving account say you have X amount of money.
Now consider what happens if…
The banks shuts down tomorrow?
Their system is hacked? Technical difficulties/maintenance?
Your account gets hacked? Someones knows your banking info?
The government wants to freeze your account?
A terrorist attack? (See Afghanistan situation- LINK)
A catastrophe occurs, a pandemic perhaps?
You want take more than $10K on a plane?
You want to send/receive money over $10K?
Some of these scenarios would make that X amount of money in your account unaccessible. Do you really have true ownership of your money?
Just like the proposed IRS tracking bill for all deposits $600 or more, the government will never stop in their attempt for power over you. If they can control your finances, they can control you.
If you think these are apocalyptic scenarios and won’t happen, you’re wrong. They are happening. Here’s a small example from two weeks ago…
A cold-wallet lets you secure your money and makes your security bulletproof. It also fixes every problem listed above and much more.
My preferred wallet is the Trezor Model T. It has an open source software and is one of the best cold-storage wallets in the market. It’s extremely easy to use.
If you are going to buy it, make sure you buy it directly from the Trezor website. I’ll link the site below but it’s better to google it at the time of purchase just to make sure it’s up-to-date.
Do not try to find it on Amazon or elsewhere, tampered devices and scams are abundant in this space. My next suggestion will elaborate more on this.
Wallet #2 - Ledger Nano X
Ledger is another top cold-storage wallet maker but since this is an honest letter, I’ll share my experience.
I had happened to order my Ledger right when they had a data-leak early 2020. This leak didn’t affect the wallets themselves but the information used to order the devices was leaked. This included emails, names and addresses etc.
After I ordered the device, I started receiving numerous scammy crypto emails. They were in my inbox and my junk folder. I had the common sense to never click on them and delete them right away BUT if you read the Ledger Reddit forums, some people weren’t as smart. People unknowingly gave access to their wallets and lost their entire holding.
The data leak is the reason why I switched to ProtonMail, which is most secure email platform in the market. I’ve never looked back at Gmail or Hotmail platforms since.
It’s important to note the Ledger itself is still secure. It’s very easy to use and has some cool fail safe attributes incase you’re held at gunpoint and forced to tell someone your keys. I’ve used mine to transact and secure coins BUT considering my experience, I thought it was wise to switch over to the Trezor.
I don’t care if I have $1, $1M or $1B, security is essential in the crypto space, especially as the market grows.
Allocation
Hot Wallet - 10% of overall position or less
Lending - 10% of overall position (20% if you have higher risk tolerance)
Cold Storage - 80%+
Reasoning?
Hot-wallets are easier to hack and exchanges can go down (see Mt. Gox story). The same goes for lending platforms. Crypto lending is not insured unlike your traditional bank accounts hence risk remains. I’ve had no issues with lending in the last two years but that doesn’t mean something won’t happen tomorrow. Also keep in mind, until you take cold-storage of the coins, technically they aren’t yours.
Keep a majority of your wealth in cold-storage. Assuming you are level headed and in it for the long term, this is the most secure way of owning your coins. Free from the reach of anyone.
Remember to never share your keys/pass-phrases with anyone and DO NOT digitally store any valuable information related to the wallet. This means do not store your passwords in the notes app on your phone. I probably wouldn’t tell a spouse either.
It may be wise to keep your passwords in a safety deposit box at a bank or somewhere secure.
As you navigate this asset class in hopes of astronomical gains, always remember the importance of security.
LINKS
Shakepay - https://shakepay.me/r/FWVZAB2 (Referral link, get $10 when you buy $100 of crypto)
OkCoin - https://www.okcoin.com/join?channelId=600089841 (Referral link, get $50 of BTC when you buy $100 of crypto)
Ledn - https://platform.ledn.io/join/a062fbfac3b81526ffef9f0dd06a83fc (Referral link, get 10 USDC when you put $75 or more of crypto)
Trezor - https://trezor.io/
Ledger - https://www.ledger.com/
ProtonMail - https://protonmail.com/
Disclaimer: The views expressed by the author are not intended to serve as any form of financial advice. This letter is for entertainment purposes only. Please do your own due diligence and research.
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