"Auto-Compounding" BCH Earnings With noise.cash and Nexo

in LeoFinance3 months ago

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Those of you who follow my work know that I am a huge fan of several crypto-based social media platforms including Publish0x, LBRY, Uptrennd, and Hive. Although each of these platforms has its unique advantages, the focus of today's post is how to maximize your earnings on Bitcoin Cash based platforms by taking advantage of the low transaction fees and frequent withdrawals that are allowed by platforms such as read.cash and noise.cash. In this article, I will show you how to "auto compound" your earnings from Bitcoin Cash based social media sites by withdrawing directly to an interest bearing Nexo account. I will also cover the advantages and risks of this strategy with the goal of helping you make a more informed decision.

(Unsupported https://lbry.tv/$/embed/nexo/cea01cf00362add73c8402818c4e499f01cc12e9?r=ZXm1XjaiyrER3aYoGiZsAVsyssYCuR3F)

More Frequent Compounding = Faster Growth

It is common financial knowledge that the more often you "compound" your money, the quicker your money will grow. In other words, interest that is compounded monthly will allow you to build your wealth quicker than interest that compounds yearly since the newly compounded interest can begin earning interest of its own.

In contrast to some ERC-20 based sites which only allow weekly or monthly withdrawals, sites like read.cash and noise.cash will allow you to withdraw almost instantly. Thus, you can deposit your Bitcoin Cash earnings almost instantly into an interest bearing platform like Nexo or Celsius and begin earning interest almost immediately as you earn your crypto. This allows much quicker compounding than only depositing crypto once a month as would be possible with other platforms. In the case of noise.cash, you can actually link your Nexo wallet directly to your noise.cash account so that your withdrawals are sent there automatically for true passive investment. Each time you make a comment or receive a tip, a portion of that will automatically be sent to Nexo so you can be earning interest. (Unfortunately, I can't remember the user's name who suggested this strategy).

The BCH --> Nexo Strategy

Although it is possible to effortlessly earn interest by withdrawing directly to Nexo (or another platform) there are inherent risks that must be fully understood! There is the risk that you could enter the wrong address. There is also the risk that the exchange (or lending platform) could be hacked. There is the risk that the loans might not be repaid. Without going into all the details, I should point out that Nexo (and most other platforms) have taken steps or purchased insurance to reduce this risk, but it is still something to be aware of.

If you have decided that the "auto compounding" interest strategy is worth the risks, then here's how you do it. For the purposes of this article, I am going to assume that you already have a Nexo account as well as read.cash or noise.cash. If you don't have either of these, you can check out my articles on Nexo, read.cash, and noise.cash for a quickstart guide.

Here's How

Linking either your noise.cash wallet or your read.cash wallet to Nexo is fairly simple and follows a similar process. The first step is to open your Nexo account and click "Top Up". This will show you the BCH address for your Nexo wallet.

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Although this is a valid BCH address, we will need to translate this address into one that read.cash and noise.cash are capable of sending to. To do this, you can use a variety of Bitcoin Cash address translators. I will be using this translator, but you are free to use one of your choice. Simply paste the Nexo address and the translator will give you an address that begins with "bitcoincash:" followed by some numbers and letters.

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Once you have the updated Cash address, you copy that to your clipboard. For the rest of the article, when I say "Bitcoin Cash address" I am referring to this translated address that you received.

On noise.cash, simply click on the dropdown menu for wallet.

noise wallet 1.PNG

Then simply paste the address into the bar and click save.

noise wallet 2.PNG

The process for read.cash is a bit different, and although there is a "Use Other Wallet" option, I wasn't able to get this to work and simply had to manually enter the Nexo address in the withdraw.

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Once you have everything set up, it's only a matter of time before that BCH starts flowing into your Nexo account and earning you rewards. With noise.cash, the rewards will be processed automatically. Every time you send or receive a tip, the funds will go directly to Nexo. With read.cash, you must manually do a send request, but again, because of the low transaction fees, this is something you can easily request much more frequently than with ERC-20 based platforms.

Although the BCH will flow directly to Nexo, it will take a while to show up, so don't get worried if you don't see everything immediately. Nexo requires 16 block confirmations before BCH will appear in your account. Since Bitcoin Cash block times are around 10 minutes, expect to wait several hours before seeing your funds.

Summary

In summary, the large variety of crypto-based social media platforms available gives content creators a lot of great options. One of the great things about BCH based platforms is that they allow more frequent (or instantaneous) withdraws than ERC-20 based platforms. While this is an advantage in and of itself, this advantage is magnified when earnings are instantly rolled into interest earning accounts. As with everything in crypto, there are risks involved, and the normal risks of crypto are heightened when giving someone else control of your funds. It is your responsibility to do your own research and determine if the potential for increased profit is worth it for your specific situation. As always, this is not financial advice.

Thanks for reading!

References

https://www.publish0x.com/the-part-time-economist/centralized-crypto-finance-the-forbidden-fruit-xxrmmk

https://www.publish0x.com/the-part-time-economist/overview-of-readcash-crypto-social-media-platform-xxozlwo

https://www.publish0x.com/the-part-time-economist/new-noisecash-the-bch-version-of-twitter-xryyxld

Image Credits

https://platform.nexo.io/deposit/bch

https://noise.cash/settings/wallet

https://read.cash/notifications