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Hi everyone,
this is an update to my first post on YieldNodes, published 10 days ago. I deposited ~$600 in Bitcoin which arrived in my account after 1 day and started earning interest two days ago. This interest is generated through "Master Noding" which is the process of providing capital to a master node of a Proof-of-Stake cryptocurrency. For a more detailed explanation, check out my previous post.
My Strategy on YieldNodes (To compound or not to compound)
YieldNodes is a great way of diversifying my portfolio with a medium-risk, high reward asset. I consider YieldNodes medium risk because of all the transparency coming from the CEO and the company. They did two voluntary audits and delivered on their promise of 5-15% returns per month for the full last year. Of course some risks remain, when you send your capital to a company, that's why I still diversify.
Now, there are two ways to go about your earnings on YieldNodes:
- Pay out the return of the month to your Bitcoin wallet /SAPP wallet
- Compound the returns (0% - 100% in steps of 10% possible)
As you learned in my previous article, your initial deposit is always locked for 6 months. This is needed to create stability, as YieldNodes needs to rent servers and maintain the master nodes.
Your compounding returns are also locked for 6 months, but not your total capital. So my initial $600 dollar can be payed-out in June 2022, while my compounded returns from this month (let's say $60 if I get 10% this month) will be locked until July.
The big upside is the power of compound interest. On YieldNodes this means for next month I can get 10% interst not only on my $600 but on $660! This might not sound like a big difference, but this is because we humans are really not good at understanding exponential math.
As it is explained on the YieldNodes website: the added returns last 26 months were around ~132% (~11% per month, not compounded). If you compounded these rewards, you would get
Using these numbers on my investment, I can basically choose between a profit of $792 (132%) or $1500 (250%). My total balance at the end of the year would be $1392 or $2200 respectively. As YieldNodes is a riskier part of my portfolio, I will use the second strategy and reinvest all my profits. I might take out my initial investment at some point, but so far I want to make use of the high returns.
Want to get started on YieldNodes?
- Do your own research on YieldNodes, in the end I am just a random guy on the internet!
- my affiliate link (click here) to register and give me 5% of your deposit with no extra cost for you. Thanks in advance!
- Make a deposit via Bitcoin (many FIAT onramp provider are supported where you can buy Bitcoin with a credit card or SEPA transfer) or use USDT (Tron Network)
- Decide whether you want to pay out your earnings or compound them!
- Only invest what you can afford to lose
- Let me know if you would like to know more, you can reach me on
And that's it for today! I hope you enjoyed my article. I will publish all updates to me portfolio on here. Likes this post and Follow me if you don't want to miss that.
So long,
None of this is financial advice. Please always do your own research.
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Some other posts you might like:
How to get your money out of a liquidity pool even without the farming website (Or the story of my very first rug pull)
How to get some solid returns on your stable coins with IRON Finance on the Polygon Network
Understanding Crazy Crypto Yield Percentages: APR vs APY - The Power Of Auto-Compounding Explained
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