bitcoin dividends

TURN YOUR BITCOIN INTO A PASSIVE INCOME GUSHER

If you are one of those chaps that views bitcoin as a new long-term, reliably, albeit volatile appreciating asset class due to the intractable irresponsibility of US government monetary policies, there is a strategy to use your bitcoin safely to gush a free cash flow yield of of 50% and higher.

I cannot take credit for originating most of the ideas on which I write and recommend in STEALTH WEALTH | Confidential, but commission-free DSTs and this strategy of turning bitcoin holdings into a passive stream of massive cash flow I can proudly claim as two of my originals.

Mind you, this will only work if bitcoin remains a long term growth asset. If you do not have confidence in bitcoin’s long term growth prospects, this investment is not for you.

Here's How

Borrow a reasonable percentage at low rates against your bitcoin on the platforms listed below and invest those funds in a bitcoin based call option writing EFT like YBTC that reliably gushes with mid double-digit yield.

A bitcoin call option writing EFT is an exchange traded fund that writes call options on bitcoin in exchange for cash flow in the form of options premium which is distributed monthly to YBTC holders.

In the options market there are traders that will pay a premium for the right to own bitcoin at a higher price before an expiration date.

If bitcoin rises above the contract price (strike price) within the expiration period (expiry), the EFT keeps the options premium, plus the difference between the market price of the bitcoin at the time the option was sold and the strike price of the option when it was exercised and transfered to the option's speculator. If bitcoin trades sideways or goes down before the option’s expiry, the EFT keeps both the bitcoin and the paid-up premium.

Traders paying premium for the right to buy your bitcoin at a price higher than current market are betting that bitcoin will go up by a lot and they can control it at just the cost of the option, instead of the capital required to own it outright. If it does pop substantially in time, the trader gets the bitcoin contracted for with all of its appreciation, less the original strike price and premium paid.

Because bitcoin is such a volatile asset, the premiums are mind-melting. The Roundhill Bitcoin Covered Call Strategy EFT (YBTC) yield is 44.35% at the time of this writing, which is not unusual for this EFT. That means that this EFT is making and distributing to their investors 44% of the value of their bitcoin holding in the form of call premium. (Actually they employ a synthetic holding strategy, but that's besides the point.)

Of course the price of YBTC is volatile because of the wild prices of its underlying asset. However, YBTC does the best job of all other bitcoin call writing option EFTs at maintaining the fund’s net asset value (NAV). That is, the price of YBTC is less volatile than their competition. (See Chart, below, where YBTC NAV remained nearly flat since it's inception in January 17, 2024.

The winning strategy is to buy YBTC (and bitcoin for that matter) on bitcoin dips, where the YBTC net asset value (NAV) is relatively low. Maintain your cost basis in this investment by reinvesting YBTC’s substantial dividend back into YBTC when YBTC is trading below your NAV cost basis.

For example, if you buy $50,000 worth of YBTC and the value of your YBTC falls below $50,000, reinvest the YBTC substantial dividends back into YBTC until your YBTC is equal or greater than your $50,000 cost basis. Once it exceeds your cost basis, this strategy becomes a bitcoin dividend cash machine. If you're lucky and time it right YBTC will trade below your cost basis for a very limited time of your holding period, and this strategy will just gush tones of cash flow from the get go.

But be prepared to reinvest your dividends to keep your YBTC NAV positive.

While YBTC will never match the price gains of bitcoin, YBTC NAV will grow or stay flat over time to consistently maintaining your investment cost basis as bitcoin rises in price over the long-term. YBTC NAV consistently maintain its NAV by writing calls above market and gaining the difference between bitcoin’s market price and the higher price strike YBTC when bitcoin soars, on top of the premium it's owners wheel barrow out every month..

BTC_YBTC

Eventually, given our thesis that bitcoin is a long term growth asset, the YBTC NAV will permanently rise above our cost basis and the reinvested dividends will drive down your NAV cost basis, and we will receive consistent mind-boggling yield as long as bitcoin remains a long term growth asset.

Use the premiums to pay for the cost of borrowing against my bitcoin. Enjoy the balance as possibly the richest cash flow creation you'll ever have in your portfolio - all from this passive income.

We're not investing in YBTC to capture parabolic bitcoin moves. We own bitcoin for that. We're just using low cost bitcoin collateralized loans to make gushing long term yield against bitcoin holdings.

As of this writing, you can borrow the US dollar based stablecoins collateralized by your bitcoin for as little as 3.69% APR. There are both traditional finance brokerage firms, traditional finance crypto firms and DEFI platforms using reliable smart contracts available to borrow against your bitcoin right now.

The same strategy may be employed with other asset classes you invest in with confidence of long term growth, like gold-based (GLD, IAU), and silver-based (SLVO) option writing EFTs. I have more confidence in bitcoin and YBTC’s stable NAV option strategy management.

Prudence must be exercised in the amount of borrowed leverage to avoid liquidation risks on the bitcoin collateralized loan.

As of this writing, this strategy (adjusted for NAV reimbursements when NAV was butressed with diverted dividends) has made 58% on YBTC adjusted NAV since YBTC's inception on January 24, 2024, 55% in the last year, and 62%, and 68% in the last 6 and 3 months, respectively on an annual basis. Even disregarding the strategy of buying YBTC on pullbacks, and buying it at its all time high ex-dividend date on 3/28/24 at $51.60 would have resulted in a 57% annualized yeild.

If you follow the damn rules and only buy YBTC on pullbacks, your annual yield will be much higher.

Of course maximizing returns by 1) taking advantage of the best bitcoin loans accross all tech platforms; and 2) using reliable technical analysis to buy bitcoin and YBTC on bitcoin pullbacks; and 3) maintaining safe bitcoin liquidation risk significantly enhances the profitability and cash flow of this strategy.

At Stealth Wealth | Confidential we signal to our investors the most opportune liquidation management, timing to purchase bitcoin and YBTC, we provide an on-line calculator to manage net YBTC NAV for dividend reinvestment requirements, and give step-by-step guides on how to borrow against your bitcoin at both traditional and DEFI platforms.

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