Crypto Income Models - How You Build Matters

in #leofinance11 months ago

The Key Benefit

When it comes to Cryptocurrency there are two very important aspects that make it unique. Not only are these particular aspects unique, but they are at the very essence and heart of Cryptocurrency. Independence and self-custody are two incredibly powerful dynamics, especially when coupled together. Those who choose to maximize these two dynamics get to enjoy the freedom that Crypto enables.

The idea of self-custody is itself an expression of independence. However, the true aspect of independence comes down to how and where you build. You can build income models within the Crypto realm that are reliant upon others, as well as entities… and then you can build income models that are more heavily reliant upon code and protocols. Many are still very much stuck in a WEB2 level thinking.

They simply transfer the same principles of TradFi and legacy business models to what they term decentralized alternatives…and then continue to praise WEB3 and decentralization. However, in practice, they are still bound by WEB2 ideology. This becomes blatantly clear when observing behaviors, conversations, and intent. The true brilliance of Cryptocurrency is that this is no longer required, in order to experience success.

You will note how many platforms that enable some form of Crypto income tend to adjust their stance and values from time to time. Essentially, this has the power to eradicate or diminish the earnings of someone who has perhaps sacrificed and invested much, in order to create that particular income stream. All aspects of life are susceptible to the knock-on effect. Essentially, this is simply the consequence of somebody else’s actions. This is something that needs to be considered when creating income models.

As If Volatility Wasn’t Bad Enough

Choosing to build within the Crypto economy automatically incurs a high level of risk and volatility. However, if what you build has too much exposure to the decisions of others, your risk profile increases. You might not necessarily realize this initially, but time is likely to expose this fundamental weakness for what it is. The key is not to allow too much exposure to that which others are able to influence, whether positively, or negatively.

The majority of your exposure should be as decentralized as possible, and outside of the influence of others. Decentralized Crypto protocols offer a superior position than that of relying on the behavior of others, even if they are operating within “decentralized models”. This is a lesson many are likely to learn at the worst possible time in their Crypto journey. If the bulk of your income is protocol-based, as opposed to personality based, you are in a better position.

Essentially, Crypto is able to provide a rather robust level of independence, and yet very few ever get to experience it. Why? Because they translate the same practices of human reliance into a world that doesn’t necessarily require it. AI is beginning to drive this understanding home to those who have ears to hear. Legacy business models operate on an ancient Egyptian ideology.

A handful of executives position themselves and then enslave others through the carrot of ladder climbing. Essentially, they become fat cats on the backs of others. They toss scraps at their workforce, knowing that their desperation is their weakness, and therefore reason that they will be happy with crumbs. This is the legacy business model.

Ironically, many who enter the Crypto space with “means” choose to apply this very model, in order to advance their own agendas. Decentralization is a myth! There are only levels of decentralization. There is no pure expression of decentralization, which is why, how you build matters. Creating income models that incorporate stronger levels of decentralization is imperative if you wish to create something that lasts, and is not built or reliant upon the actions of others.

One can never truly escape this fundamental flaw. However, choosing to minimize your exposure to it will go a long way in creating a level of independence. Together with this approach comes that of diversification. Being fully exposed to a single idea can be quite powerful. However, it can also be equally destructive. I love the idea of diversification and multiple niches. It creates a net of safety and reassurance.

Final Thoughts

One of the key lessons that emerged out of the covid lockdowns was that of independence. Many found themselves in extremely difficult situations. Others, unfortunately, completely lost their ability to earn. This a prime example of how too much reliance and too little independence can be quite damaging. This, perhaps, was not the case 10 years ago. However, times have changed, and so do the “models” we rely on.

Income opportunities can be ranked in terms of their levels of decentralization and ability to continue earning despite various challenges and unexpected events. One needs to really consider this aspect when creating an income portfolio. That’s it for this one. See you next time!


First of all, I am not a financial advisor. All information provided on this website is strictly my own opinion and not financial advice. I do make use of affiliate links. Purchasing or interacting with any third-party company could result in me receiving a commission. In some instances, utilizing an affiliate link can also result in a bonus or discount.

This article was first published on Sapphire Crypto.