$$$ KPO and CZM $$$

Tuesday, May 17, 2022

We lost >2 million SGD in the Collapse of Terra LUNA & Good Bye

After the "Great Depeg" of UST and the collapse of Terra LUNA, we received lots of messages, emails and comments. Usually, I would try to reply to all of them but I really didn't have the mood to do anything then. Now that both of us are sort of in the final stage of grief (acceptance), I have decided to document what happened and some of our very painful lessons so that hopefully, it wouldn't ever happen to any of our readers.

What's left of our crypto portfolio

At its peak (Portfolio - March 2022), we had a crypto portfolio worth 2.4m SGD with 597k SGD debt from Anchor Borrow and ~100k SGD worth of NFTs. Not forgetting, I had a crypto business with 2 other friends that was built on Terra and we had a bunch of aUST and 5 digits LUNA before the depeg happened. All that is left now is around 28k SGD. A loss of >2 million SGD.

The past week was probably one of the longest and toughest weeks for us. We cried multiple times whenever we think of the amount we lost and the chance/opportunity to give Baby Ong a better life. We had grand plans - buying a property that is near good schools, decoupling and buying a second property for CZM to generate more passive income. Everything vanished just like that. I blame myself for being too greedy and overleveraging while CZM blames herself for not holding me back more which definitely wasn't her fault. The fault is all mine because she wouldn't have been able to stop me. After losing her Anchor passive income, she's feeling extremely insecure and even wants to return to the workforce although I kept reassuring her that we will be fine (estimated 6-7k SGD passive income from stocks). 

For those that are still grieving, do take a look at this comic by The Woke Salaryman (CZM cried while reading this). It wouldn't cheer you up but will help to put things in perspective. No matter what has happened, life goes on. Always remember that money/wealth is merely just one aspect of life and there are more important things in life such as health, family and friends.


Long story short, LUNA price was falling and I had to avoid liquidation by repaying the loan. So I kept borrowing/taking the UST from CZM's Anchor retirement fund to repay my loan. Eventually, I emptied her account but could not fully repay the loan. In the end, we ran out of funds and there was nothing else I could do besides watching everything get liquidated. We were devastated at that point in time but I was still somewhat hopeful that the peg will be regained and consoled myself that we still have about 3-4k LUNA safely staked. Before I knew it, LUNA went into hyperinflationary mode rendering all existing LUNA worthless. I never knew this could happen and was under the impression that there is a cap of 1 billion LUNA. There are 6.9 trillion LUNA now -.- 

Lessons
1. Always take profits. I hardly thought of taking profits because I had so much conviction that UST will eventually become the top stablecoin. Why should I take profit now when LUNA is going to be a few hundred dollars by end of the year? After all, those that made huge profits are those that held on for many years right (e.g. Google, Apple, Amazon, BTC, ETH, etc.)? I am just glad that we managed to walk away with some profits at the end of the day.

2. Diversify. As of last month, we had 53% of our net worth in crypto or specifically in 1 coin and we just lost almost all of it. Had I diversified some of them to other coins or off-ramp it, we wouldn't have lost so much.

3. Do not overleverage and ensure that you have the sufficient fund to repay them when necessary. I did not have enough UST to repay my Anchor borrow debt and ended up liquidated.

4. Do not borrow fiat to invest in crypto. At one point in time, I was borrowing 30k USD from SCB and putting that money into Anchor to earn the difference. Eventually, I decided that it is too risky and reversed/repaid everything. I am so glad that I am not in any debt because I lost money in crypto.

5. Algorithmic stablecoin just isn't going to work. Interestingly, this was what I had believed in before I discovered UST/LUNA. You can see my preference for USDC/GUSD in my earlier crypto articles. Eventually, I was convinced that UST will work because the algorithmic stablecoin is built into a network instead of just a dapp. There's so much utility for LUNA and an excellent L1 instead of just a farm and dump coin (e.g. TITAN). If this has failed so miserably, nothing probably will ever work...

I honestly never thought the death spiral could actually happen. Although I often said that I am simply blogging about what we are doing and asked people to do their own research before investing, if you read our blog and it had influenced your decisions, I’m really sorry. At this point in time, I have sort of accepted the loss but I can't get rid of the guilt that I have been feeling for others. I had so much faith in it that I recommended it to friends and families and they are now all hurt financially. We tried to compensate our siblings' losses but none of them took it :(

~US$300 of gas fee to receive bETH

Am I going to stay away from DeFi after this? Probably not, I do believe in its potential but I will probably not put in fresh funds for the time being. Highly doubt I will ever have this kind of conviction anymore. I have tried Ethereum, BSC, Polygon, Fantom, Avalanche, Harmony, Cosmos (Osmosis, Juno and Secret) and Thorchain but none of them impressed me like Terra did. Ethereum is the worst with ridiculous gas fees for simple transactions (yes, the gwei was high but it just isn't intuitive/user friendly. I should be able to transact at any time at my convenience and pay roughly the same fees) while the rest of the EVM chains are full of forked projects with more scams than legitimate projects. Terra did not have any of those issues and I would argue probably the closest in bringing real-world use cases/adoption with apps/teams like Alice, Kado, etc. Having said that, it seems ETH is the only truly deflationary coin out there and I will be keeping whatever that is remaining. Going forward, we will possibly just accumulate the "blue chip" BTC and ETH as the bulk of our crypto portfolio.

Lastly, I have been wanting to take a break from blogging for a while but I continued because once in a while I get encouraging messages/emails telling me how we have inspired them to start their investing journey early but I guess this is it. Not sure how long the break will be, could even be indefinitely. Besides, you probably shouldn't read/learn from someone that has lost so much money going forward. lol. Take care everyone and till next time or not :'(

P.S. Our blog ended up in a police report and we were quite amused by it. Honestly, whoever that reported it should probably spend more time and effort looking for a job and not waste the police resources.

Sunday, May 8, 2022

Portfolio - April 2022

Our portfolio didn't hit a new high last month but something else did - my cholesterol -.-"


I have not done a health checkup for the last 2 years after I changed job and things got a lot more hectic with the arrival of Baby Ong. I decided to do it last month after CZM's nagging, only to find out how I am dying I have neglected my health. I am currently on medication (Trolip 100 fenofibrate) and will be making some lifestyle changes (healthier diet and exercising). In fact, I was planning to change/look for a new job a few weeks back when I found out one of my ex-manager moved to a crypto company (my area of interest nowadays) but I guess that's not important anymore. My priority is to reduce my cholesterol and stay alive. lol. Alright, enough with the sharing of such bad news.

Last month, we went on a Royal Caribbean cruise - Spectrum of the Seas (cruise to nowhere) together with my parents. It was a nice break from work and being able to "travel" after covid but travelling with a child is really tiring. 

What CZM sent me after the trip

Baby Ong probably enjoyed herself the most given that she had many new experiences - 1 happy baby with never-ending energy with 4 happy and tired adults. lol.

Portfolio


Total: $4,039,560
Leverage/Debt: $1,212,960
Gearing: 42.91%

Our Passive Income - Dividends


Dividends for this month: $432.00
Total dividends collected for 2022: $14,221.93
Average dividends per month for 2022: $3,555.48

Our Passive Income - Anchor Earn


Estimated interest for this month: US$3,079.80 (~SSG$4,262.49 )
Total interest collected for 2022: $21,322.62
Average interest per month for 2022: $5,330.65

A few things for the lower passive crypto income:
1. Anchor yield has been lowered to 18%
2. I moved 50k to repay my Anchor borrow/loan to have more buffer/prevent liquidation as LUNA price falls
3. I moved 50k to THORSwap to provide liquidity with the plan to get more yield under the impression that the initial capital will be protected by the Impermanent Loss Protection (ILP). Just take note - ILP does NOT protect you from both assets depreciating! This is loss, as this would occur if you were just holding the assets regardless. 


In this case, we are losing money because of the lower RUNE price. I only realized it when the protection amount didn't seem right while I am writing this article. Not sure why I made such a noob mistake. Must be the cholesterol. Anyway, I will be looking to exit this position once it turns positive not because I do not believe that RUNE will recover/moon but because this is CZM's retirement fund which shouldn't have exposure to such volatility. In fact, at the current RUNE price, it has the lowest speculative premium while its deterministic price is rising makes it a pretty good investment...

Total passive income for this month: $4,694.49
Total passive income collected for 2022: $35,544.55
Average passive income per month for 2022: $8,886.13

The best part is these are all tax-free :) Technically, our passive income is much higher but I excluded staking yields and LP rewards because they are much harder to track and I have been using staking yields for buying NFTs. lol.

Stocks


We decided to deploy more leverage to buy more REITs given that Singapore is slowly opening up and these prices are still way below pre-covid levels or our average entry price:
- Ascendas Reit
- Ascott Trust
- Mapletree Log Tr

The idea of using leverage is simple, borrow the money, buy a good/excellent REIT/stock, use the dividends to pay the interests, and keep the difference while ensuring that we will never get a margin call/trigger. Once again, leverage has its risk and is definitely not for everyone. We see it as our way of buying a second property without incurring any of those taxes (ABSD, rental income tax, etc.). You can take a look at this - Leverage Performance 2020.


These are the top 10 stocks in our portfolio.

Total: $2,009,985.89
Leverage/Debt: $649,158.56

If you are interested in the smart portfolio tracker (StocksCafe) which I am using as shown above, sign up using my link for a longer trial period :) Refer to our Referrals page for more information.

Endowus


Capital: $62,280.70
Current: $63,790.61

I decided to invest my CPF OA last year and blog about it here - Investing CPF OA Through Endowus

If you are interested in Endowus, do use our referral link for our readers! You will get S$10,000 managed free for 6 months ($20 equivalent) and we will get $20 too! This access fee has no expiry date.

StashAway


Capital: $6,000.00
Current: $5,933.25

The only remaining portfolio with StashAway is CZM's SRS. No plan of doing anything at the moment.

If you are interested in StashAway, do use our referral link. You get $10,000 free management fees for 6 months and we will get $16!

Crypto


We are not too concerned with the fall in price and are still holding on to ~12k LUNA. I will only be worried if it falls below $70 which will be near our liquidation price >.<


Total excluding NFTs: $1,960,120.94
Leverage/Debt: $563,800.99

Nothing much happened last month except some Terra NFT drama which resulted in one of my favourite NFT launchpad/marketplace (Luart) getting boycotted. What is exciting for the first week of May (happening right now!) is a series of lockdrop happening for ASTRO, ANC and PRISM tokens. Personally, I prefer participating in lockdrop as compared to airdrop although both are "free" money, one gives me a lot more. lol. To put it simply, you can see them as the government "dropping" GST/U-Save vouchers/credits. lol.

Not going to spend too much time going into the details but my gameplan is as follows:

Deposit xASTRO for RETRO on Retrograde

Assuming xASTRO costs US$2.88579, I am locking US$26,922.56 temporarily to get an additional US$20k for free. 


Using the same valuation, my airdrop amount is just ~US$93. Do you see why I prefer lockdrop? lol.

Deposit ANC for RCT on Reactor

Assuming ANC costs US$1.886, I am locking US$8,285.12 temporarily to get an additional US$5.8k for free. Magic!

Deposit xPRISM for PSI on Nexus

Assuming xPRISM costs US$0.485, I am locking US$4,850 temporarily to get an additional US$3.1k for free. Must be ponzi!

Anyway, these are just estimated returns but I do expect them to be lower when the lockdrop ends as more tokens are being locked/provided as liquidity. In addition, I am pretty sure after vesting, people will dump the respective token and the price of those free tokens will definitely be less than what they are being valued at now. Did I mention that about half of my ASTRO tokens were "free"/from lockdrop too? lol.

You can refer to our crypto portfolio (except for CZM's retirement Anchor) on Ape Board for a more detailed breakdown of how we DeFi although you wouldn't see all of it because some of my coins are still with the exchanges.


These are the top 10 coins in our portfolio.

Did not manage to update my NFT spreadsheet + felt lazy but at one point in time, my NFTs were worth slightly more than SG$100k in total (definitely lower now). Shall just briefly mention some of them here.


The most hyped NFT project released last month was HellHounds. I minted 4 of them (150 UST each) because I was whitelisted for holding 4 HellCats and one of them had the "Iced Out" trait with a floor price of around 64 LUNA (~US$4.6k). That's easily more than a ~30x return and much more if I were to include the 3 other hounds.


Remember the cat which I bought for US$5k 2 months back?


The floor price for the "Ripped Denim" trait is now 97 LUNA (US$7k). Still not planning to sell :) 


My most valuable NFT will be this Galactic Punk that comes with a glitch valued at 205 LUNA (~US$15k) based on NFT Deal Score. lol. Diamond hands until it reaches 6 digits!

Anyway, I have blogged about different ways to leverage crypto to build wealth for people with different risk appetites:

If you are interested in the platform I am using, do sign up using our referral links for some bonus :)
BlockFi: Deposits US$100 or more into your BlockFi Interest Account (BIA), you will earn US$10 in BTC and we will earn US$10 in BTC too.
Celsius Network: Earn US$50 in BTC with your first transfer of US$400 or more and we will earn US$50 in BTC too.
CakeDeFi - Deposits US$50 or more into your CakeDeFi account, you will earn US$30 in DFI and we will earn US$10 in DFI too.
Gemini: We will both receive US$10 of bitcoin after you buy or sell US$100.
Crypto.com: Sign up using our link, stake SG$500 worth of CRO and we both get US$25 in CRO
FTX: We will receive 25.00% of your trading fees and you will receive a 5.00% fee discount on all of your trades.

On a side note, Futu's moomoo app is giving free SEA share for their sign-up promotion. Do read the T&C here for more information. If you have yet to open an account, you can do so using our referral link :)

Accidentally clicked on the annoying ads? Let me thank you in advance as you are indirectly doing good as we will be Donating 100% Ads Revenue Going Forward!

You might be interested in these blog posts too:
2021 Net Worth
Our CPF 2021
Portfolio - December 2021 - $2,100,909
Portfolio - January 2021 - $2,307,446
Portfolio - February 2022 - $3,333,706
Portfolio - March 2022 - $4,277,975
- Portfolio - April 2022 - $4,039,560

Do like any of the following for the latest update/post!
1. FB Page - KPO and CZM
2. Twitter - KPO and CZM
3. Click here to subscribe using email :)
4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)

Wednesday, May 4, 2022

Retiring using Anchor Earn + Crypto.com Visa Card

Regular readers will know that CZM has retired already and the bulk of our passive income comes from crypto (specifically Anchor Earn). One of the most common questions I get is how to off-ramp and spend those digital money/profits, hence this will be a step by step guide on how we are doing it :)

We are doing 2 types of off-ramp:
1. If we are planning to off-ramp >US$10k, do it through FTX. Convert everything to USD and wire out to bank account.
2. Off-ramp smaller amount for daily expenses. This is harder because fees will make it not worth the time/effort. However, one can actually use the Crypto.com Visa Card to bypass/cut down on the fees.

1. Withdraw money from Anchor (UST 1,000) 


2. Get your "Deposit" address for UST from FTX
Technically you can use any exchange that accepts both UST and USDC. If you are wondering why USDC, that's because that's the only stablecoin accepted by Crypto.com now.


Again, I can't stress this enough - always make sure you are transferring to the correct network, address and memo. Memo is your unique identifier when you are transferring to exchange. You can probably still get your crypto back without the memo but it is going to be a very painful and long process. 


FTX: We will receive 25.00% of your trading fees and you will receive a 5.00% fee discount on all of your trades.

3. Send UST from wallet to FTX


You should get the UST in your FTX account almost immediately (<1 min).


4. Sell the UST to USD (FTX recognizes 1 USD to 1 USDC)


The more cost-effective way is to use a limit order and wait but most of the time, I will just use market order and move on with life. lol.


5. Get your "Deposit" address for USDC from Crypto.com
Go to either "Accounts" then "Crypto Wallet" or find USDC under "Track".


Select "Transfer" followed by "Deposit".


Select "External Wallet".


Select "SOL" (Solana) and take note of the address. Transferring from Solana should be the most cost-effective way.

Crypto.com: Sign up using our link, stake SG$500 worth of CRO and we both get US$25 in CRO

6. Send USDC from FTX to Crypto.com


Select "Withdraw" for USD followed by "Withdraw USDC".


Paste the Solana address and ensure that the withdrawal method/network is Solana too. In this case, there is no memo which means that the wallet itself is unique for each user. Sending to the wrong address will mean the fund is almost irrecoverable. Anyway, I will typically send a small amount to test because if it goes through, there is no need to worry about a bigger amount.


The transfer is relatively fast as well (<5 min) unless the whole Solana network goes down. lol.


7. Top up the Crypto.com Visa Card


Select "Top Up".


Top up using USDC.


Done! I admit that this might be slightly troublesome for now but I guess we just got to be patient and wait for Crypto.com to accept UST deposit :)


Based on my experience, this is probably the most cost-effective way to off-ramp and spend those small crypto profits. I have even tried the IBC (osmosis and crypto.org) route but this is the preferred way cause we are using stablecoins throughout (no volatility while transferring). Let me know if you are doing it differently/better. 


The google rate as a reference but given that it is almost impossible to get that rate, let's use the rate from DBS.


As you can see, the exchange rate provided by Crypto.com is actually quite competitive.


I know that Crypto.com recently cut the cashback and remove the staking rewards but honestly, I don't really care. I just like the convenience/ability to spend our Anchor Earn interest/crypto passive income :) 

What's stopping you from exploring crypto? If Mark Lee (李国煌) can DeFi, so can you. lol.

Anyway, I have blogged about different ways to leverage crypto to build wealth for people with different risk appetites:
Retirement Hack
- Retiring using Anchor Earn + Crypto.com Visa Card

If you are interested in the platform I am using, do sign up using our referral links for some bonus :)
BlockFi: Deposits US$100 or more into your BlockFi Interest Account (BIA), you will earn US$10 in BTC and we will earn US$10 in BTC too.
Celsius Network: Earn US$50 in BTC with your first transfer of US$400 or more and we will earn US$50 in BTC too.
CakeDeFi - Deposits US$50 or more into your CakeDeFi account, you will earn US$30 in DFI and we will earn US$10 in DFI too.
Gemini: We will both receive US$10 of bitcoin after you buy or sell US$100.
Crypto.com: Sign up using our link, stake SG$500 worth of CRO and we both get US$25 in CRO
FTX: We will receive 25.00% of your trading fees and you will receive a 5.00% fee discount on all of your trades.

On a side note, Futu's moomoo app is giving free SEA share for their sign-up promotion. Do read the T&C here for more information. If you have yet to open an account, you can do so using our referral link :)

Accidentally clicked on the annoying ads? Let me thank you in advance as you are indirectly doing good as we will be Donating 100% Ads Revenue Going Forward!

Do like any of the following for the latest update/post!
1. FB Page - KPO and CZM
2. Twitter - KPO and CZM
3. Click here to subscribe using email :)
4. Instagram - KPO_and_CZM (Did you see those delicious food photos to the right --> Unfortunately, you can't see it on mobile.)