How You Can Use Cryptocurrency To Pay Off Credit Card Debt
Suddenly, it’s happened. You’ve found yourself in credit card debt, and it’s an amount you never expected to have. Whether it was to cover an emergency like fixing up your car after an accident that wasn’t even your fault, or too much of a crazy time in Vegas during your bachelorette party, you need to find a way to pay it off. You know that. But with the salary you make, and how much money you’re already spending and saving, you have no idea how you’re going to get rid of your debt–and that’s scary, because the longer you wait, the worse it will get.
But recently, you’ve been thinking of using cryptocurrency to pay off your credit card debt. After all, with so many people making money off of it and using it to dramatically change the world, it seems to make sense. The startup Nanovision has created a health blockchain that’s going to revolutionize global healthcare, and Fr8 Network has created a freight blockchain that’s going to change the way shipping works in the US. Even lawyers like Aaron Kelly are benefiting from Ethereum to create smart contracts.
If all this is possible through the power of blockchain, why can’t you use cryptocurrency to get rid of debt? The fact is, you can. Here’s how:
Creating a Bitcoin savings account
Once you’ve budgeted what extra spending money you can have every month–and cut out additional expenditures you don’t need, such as that Frappuccino every morning before work and drinks on the weekends with friends–you might find that you have some money left over. The majority of this money, of course, should go to paying off your credit card debt (especially if you just completed a credit transfer so you can at least avoid additional interest on it)–but if you can let go of just a little of that money, you can create a Bitcoin savings account. Think of it as a way to raise a little extra money in a way that will slowly grow while you’re paying off your debts.
Bsave, for example, works like this: “An account with Bsave provides you with daily interest payments and the ability to withdraw funds at any time. The interest payments depend on the amount you deposited in your account and the length of your deposit. The way that Bsave is able to pay its users interest on their bitcoin holdings is by engaging in margin lending on the Bitfinex trading platform on behalf of its users.”
Considering that Bitcoin reached a worth of $10,000 in 2017, it can be a great way to raise some money in a passive way–and, psychologically, it may also ease the feeling that you’re drowning in debt, because you’ll know that in this savings account you’re slowly building up money you can use to pay it off.
Investing in cryptocurrency
Another option is to invest in cryptocurrency itself, by buying some coins and then eventually exchanging them on the market. Unlike creating a Bitcoin savings account, this strategy can be used with any cryptocurrency, especially ones that you expect my go up in value in the future. Another difference is that instead of slowly building up your savings in a bank account, you’ll buy some cheaper coins, wait for them to go up in value, and then trade them for others (or for money, if you feel that the amount you’ve made is enough to pay off some of your debt at that point).
Blindly investing, however, isn’t a good idea–especially considering that you’ve already got some debts, and you don’t want to have more. So before you invest, do some research: check out cryptocurrency blogs and podcasts, and read up on what the most up-and-coming cryptocurrencies are. Bitcoin’s gotten so expensive now–at the beginning of 2018, just one Bitcoin was worth $11,000–so it’s clearly not the right choice for someone who’s already in debt!
Additionally, you’ll want to be wary of bots. Unfortunately, because all cryptocurrency businesses live online, you can end up falling prey to scammers and the like. 30 percent of millennials would prefer to invest $1,000 in Bitcoin instead of government bonds or stocks, and with this newfound popularity, many people are being targeted.
However, you can defend yourself. According to Forbes.com, this is how to spot a bot, “You will need to carefully watch the market trading signals and learn to notice the abnormal trading patterns…The two biggest indicators of bot market manipulations are price momentum and volume. As an investor, you should carefully watch these two parameters and try to notice coordinated buy patterns early on. The alternative is to use a cryptocurrency trading analytics platform that will do ‘the watch’ for you.”
As you can see, if you use cryptocurrency in a smart financial way, it can help you get rid of your credit card debt. It’s all about being as informed as possible and making the right choices–which, if you’re ready to face your credit card debt and pay it off, is something you’re learning quite a bit about.
What stresses you out most about having credit card debt?