Hi guys, I’m using localmonero to buy XMR and cakewallet to keep my coins. My idea is to have those XMR accessible when the time comes, for example if I want to purchase something and the seller accepts Monero. The thing is I would like to have those XMR “frozen” until the situation comes without being exposed to coin prices changes. I was thinking to keep USDT, and when I need to buy something with XMR, just convert it and use that specific amount. Maybe is not the point of Monero itself. Is this approach the best option? What would be your recommendations? Thank you!
Monero hasn’t fluctuated too much in the past few years. Seems to be staying around $150ish.
You can try to mitigate the downside risk by moving to a stablecoin (like USDT, USDC, DAI, etc.), however that means you also don’t have exposure to the upside gain if the price goes up.
Also, stablecoins have their own set of risks. Unlike Monero, more stablecoins can be created out of thin air. If something crazy happens (like we learn that stablecoin creators don’t have the reserves that they claim that they do), stablecoins can drop in price as well.
Ultimately, you probably want to hold the value in whatever you think is the most trustworthy. If you trust stablecoins (and aren’t concerned about black swan events), that’s not a bad place. You could also keep it in Bitcoin, seeing as it has the largest marketcap (and more can’t be minted out of thin air), but this can still have price fluctuations. Personally, I’m not too concerned about Monero’s price dropping so I’m happy keeping it in Monero.
If it’s a large amount of money, you could even consider splitting it into thirds and putting 1/3rd in each. That way your risk is even more distributed. I wouldn’t mess with this though unless the amount of money is over at least a few thousand dollars.