How to Turn $1 Million in XRP into Real Cash Flow

Source: CryptoNewsNet Original Title: Pundit Explains How to Turn $1 Million in XRP into Real Cash Flow Original Link: A market commentator has explained how XRP investors could turn $1 million in XRP into real cash flow for possible retirement.

Notably, speculation about XRP reaching $100 has led many investors to believe that such a price could lead to early retirement. Some believe holding around 20,000 XRP would be enough to secure long-term comfort. However, not everyone in the community agrees with this.

One community analyst argued that holding 20,000 tokens at a $100 XRP price does not automatically mean financial freedom. According to this view, taxes, regular bills, and daily living costs can quickly reduce such wealth. It was also pointed out that inflation steadily lowers the value of money over time.

As a result, most people need between $5 million and $7 million to live without financial stress. Age should also come into consideration, since younger investors need their money to last much longer.

Borrowing Against The $1M in XRP

In response, it was suggested that it is less about price and more about income. Investors often focus too much on XRP’s price and ignore how assets can generate steady cash flow.

According to this perspective, holding $1 million worth of XRP does not mean selling it for fiat. Instead, investors should use their XRP to earn income while keeping their holdings intact. XRP holders can lend their tokens on decentralized lending platforms to earn yield.

It was advised that investors should not borrow the maximum amount possible. Instead, they could borrow about 65% of the XRP’s value, rather than pushing closer to 75%, to reduce liquidation risk. With this, an investor with $1 million in XRP could borrow around $650,000 in stablecoins, such as USDC.

It is also important to spread risk by using more than one stablecoin by diversifying to other options like USDT. From the $650,000 borrowed, here’s how investors could create different income streams.

How to Generate Cash Flow with the $650K

One strategy involves using about $300,000 to buy a property. After the purchase, the owner could tokenize the property through a real estate tokenization platform. This could generate yearly returns of about 4% to 8%.

On top of this, short-term rentals tied to the property, such as vacation rental stays, could bring in more than $1,000 per month in additional income. This represents a mixture of traditional real estate and newer DeFi tools.

For the remaining $350,000, stablecoin liquidity pool strategies that use looping are recommended. Specifically, a 10% annual return for this leftover capital remains realistic on well-established decentralized exchanges.

At that rate, $350,000 could generate around $35,000 per year. This income could move into other assets or support staking or running a node, which may offer returns between 4% and 12% per year.

Investors can use the yield from these strategies to repay the loan taken against their XRP. This helps manage risk, reduces debt, and keeps the XRP holdings untouched. Price movements can distract investors from the real objective. However, it is important to note that these lending protocols do feature some elements of risk, so investors should carry out proper research before utilizing any of them.