Hi fellow Lions,
Today I have started to divest myself from the popular earning apps for one reason or another. Tax is the biggest!
Cost Versus Benefit
Being an American citizen and all that with a government very much against crypto, I find myself in a bit of a pickle. I have dipped my toes into various crypto apps like Crypto.com and Celsius to try and capture some of their earnings they are offering for people to either leave tokens sitting there or locking them in to earn rewards. Is it worth it though?
I didn't pay much attention to all of it outside of sending over some of my crypto to the app. One thing that is a bit of a pain though, now that I haven't been actively monitoring it, is having to add it up now that we are preparing for tax season.
I've looked at some of the different tax options available and settled on Koinly this year given their low cost for calculating what I owe but one thing that stuck out to me as I added things on. I would add the pennies I was getting from an app that I had left some crypto on as a way to potentially earn some rewards and it had knocked me into the next "transaction" tier, costing more money to calculate, and entirely nullified any rewards I had gained from it. It's obviously relative because the prices of the tokens are in flux right now but had I spent some money each week, or added the money up and did one lump sum purchase, it would have been more worth it and I wouldn't have needed a different transaction bracket.
There are obviously many nuances to that, standards of living, and all that but I found it to be tedious, especially since I'm a casual investor in this stuff, to spend more money in the end trying to get ahead. Still overall up a good margin on the investments I've made which is always good but I don't count it in dollars anymore, I am counting it as a step closer to getting to and over a full bitcoin. Unit bias indeed but that bias will eventually pay off, I think.
Have you made any adjustments to your strategy after finding things out like this? What adjustments were they? I'd love to hear someone else's take on it!
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