Bitcoin, like other cryptocurrencies, is considered a long-term investment by many. But it doesn’t have to be that way. After all, you can also use cryptocurrency for fun. Think about playing games or purchasing NFTs with Bitcoin. Cryptocurrency poker is also a good example. CardPlayer researches cryptocurrency poker sites so you know exactly where you can play poker with your Bitcoin investment. Frederik de Koning indicates that you can participate in exciting tournaments at these online casinos.
Overall, we see the strategy being used more and more frequently. Cryptocurrencies are divided into two “baskets”: One is for passive income through staking and the other is for responsible fun like cryptocurrency poker. This way, your long-term bankroll continues to grow, while still enjoying the instant fun that characterizes Bitcoin and other currencies.
So, in this article we will look at these trade-offs. Is it better to invest in cryptocurrency for passive income or to use your coins for entertainment? Can you confidently judge what is wise, what you should pay attention to, in what situations smart savings are needed and when you can confidently have fun with the help of cryptocurrency?
What is cryptocurrency staking and how does it work in Bitcoin?
To understand when it is better to stake or spend, it is useful to first briefly explain what exactly staking is. Secure your cryptocurrency on networks running on PoS or Proof of Stake. In return you will receive a reward, often in the same coin. So to speak, you help keep the network secure and earn some sort of interest in return.
However, it is good to know that in Bitcoin this is not possible at all. This coin uses proof-of-work, so it cannot be staked in the same way as Ethereum and Ripple staking, for example. But best of all, you can generate similar passive income with Bitcoin through lending platforms. You then lend your BTC to others and earn interest.
Another option is to use savings products on exchanges. Your bitcoins will then be distributed to our internal systems. You can also earn indirectly by using liquid staking/wrapped BTC on other networks. Although this is not always technically called “staking,” it feels the same to many users. That means putting your cryptocurrency to work and earning passive income.
Benefits and Risks of Strikes
The biggest advantage of this is obvious. Don’t leave coins lying around in your wallet, use them to slowly build up additional buffers. The longer you leave it, the more you will benefit from the interest earned on it. This could be a logical step, especially if you already believe in the long-term value of Bitcoin or other cryptocurrencies.
However, it is good to know that there are some risks to consider. If the exchange or lending platform goes bankrupt, you could (partially) lose your coins. Bugs in your code can result in money being lost. Some forms of staking require you to temporarily be unable to withdraw your cryptocurrency. Therefore, it is wise not to put your entire investment on hold.
Using Cryptocurrency in Entertainment: When Do I Become Liable?
Of course, cryptocurrency also has some interesting elements. From the beginning, cryptocurrencies have been associated with innovation, digital communities, and new forms of entertainment. This includes cryptocurrency poker, blockchain games, NFTs, and other online services that accept payments with Bitcoin.
The biggest advantage of using cryptocurrency for entertainment is that you can get enjoyment from your assets immediately. After all, you don’t have to look at price charts all the time, but you actually get to actively use your coins. This can be especially attractive for cryptocurrency poker. It combines strategic gaming with the speed and anonymity of digital payments.
However, it is important to be cautious as cryptocurrencies are very volatile. Therefore, it is wise to only use a small portion of your portfolio for entertainment purposes. You should view this as play money that you can afford to lose. So set yourself hard limits and don’t let your profits increase them. This will prevent a fun evening from turning into a situation where you end up regretting an impulsive decision.
conclusion
The choice between staking your Bitcoin and spending your cryptocurrency on entertainment isn’t a matter of one or the other, it’s a matter of both if you find the right balance. Therefore, it is recommended to create three pots with your investment in Bitcoin. Use most of it as a long-term investment and place it in staking or lending. The second port is a flexible buffer. I don’t hold these coins for long, but I also don’t use them for entertainment. This is the purpose of the third part. Use these Bitcoin coins for gaming, NFTs, and cryptocurrency poker, for example!