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Few established concepts are as celebrated as 'passive income' is in the field of crypto and in non-professional investing more broadly. The very term 'passive income' suggests the target audience for the term is a group of people wanting to retire from investing, achieve a stipend and enjoy what's left of life. A professional, institutional investor would use a more technical term, such as 'rent-seeking'; for them it would not carry connotations of 'not working anymore' but rather 'achieving effortless gain'. A sigma investor would not be deceived by any of the definitions, but rather adopt what's best of both.
You see, 'passive income' has become a selling point in the crypto world and like all selling points it has begun to mean all sorts of things, sometimes bearing little to no relation to any of the original meanings. Think of how 'free shipping' is used as a selling point to get people to buy something, while actually the price has simply been bumped up a bit. The most obvious example is advertising projects such as PUBLISH0X as 'opportunities to earn passive income' - indeed, one could potentially write a huge amount of posts and automatically publish two a day, earning from them, but that would not actually be passive income: not only would you have to curate your blog, but invest a lot of your labour into writing a lot of posts. And this is basically my first point, a mental trap for betas that any Sigma would effortlessly avoid: if for this 'passive income' to actually work you have to work it ain't passive income. That's active income all right and it is not a bad thing, just don't let anyone convince you that you are not actually working when you are working and your hard earned profits are somehow magic fairy dust.
To develop on that point let me just stress how this boring idea of work or 'active income' is just as good as 'passive income' when you don't have a fortune to invest. The currency people often forget to factor in when chasing their 'passive income' is time. And time is a currency all right. Think of the Latin origin of the word. William Whittaker's words have this to say on the subject:
curr.o V 3 1 PRES ACTIVE IND 1 S curro, currere, cucurri, cursus V INTRANS [XXXAO] run/trot/gallop, hurry/hasten/speed, move/travel/proceed/flow swiftly/quickly;
If the above is not a very good description of time I don't know what is. Time flows, trots along or runs, but you can sometimes choose to spend it. Chasing a possibility is a cost, it ought to pay off in the future. Income is an opportunity and when one can earn through 'active income' (work) more than one could through chasing 'passive income' then that opportunity to achieve 'passive income' can't be that great. A Sigma would use more of the professional, institutional definition/way of thinking about 'passive income' (while he would do it for his own end and not the goals of any corpo or bank). What you want is to profit without effort, that's the passive in passive income that people seem not to think enough about. Something is only passive if no movement is involved. Investing into a safe ETF and forgetting about it for a few years is a way to reach genuine passive income. Day trading can never be passive, since it involves daily effort. I could not count the times people confused the two.
When evaluating whether to chase opportunities that promise active or passive income it is useful to employ this meta-currency of time to see how opportunities compare. It may well turn out that you are better off spending your time working and then investing money earned into something fairly safe or interesting rather than participating in yet another airdrop, filling out a long questionnaire, chatting to a bot, shilling on twitter, and hoping to be in the lucky 100 winners (out of 100 000 participants) to get 7,5 USD in GalaxyPizzaStarFleetCoin - all of which takes the beta something like 6 hours since he does that with his 5 alt accounts, all in the name of passive income. You clown! You have just worked a full day's work for lottery tickets and you call that investing to get passive income?
TL;DR: Don't be fooled, income is only passive when it is passive. Otherwise it means as much as 'Free Shipping' does on Aliexpress
