5 Awesome Things to Make Money Using Cryptocurrency
Are you shocked it might be too late for you to hop on to the cryptocurrency train? Well, crypto is going nowhere, and fortunately for you, you don’t have to be one of the early holders of cryptocurrency to reap the benefits.
We all have heard these stories about the men and women driven by a hunch or some well-calculated mathematical probability to invest in crypto who ended up raking in thousands or millions.
But this early in the game, your chances of success were less certain than now; fewer people understood what was going on, too few to explain to you, as compared to now. But by now, crypto is getting more popular and your chances of success can, to some extent, be foreseen from the get-go.
Earning passive income with crypto isn’t rocket science, although it does involve some strategy. Here are 5 ways you can earn passive income through cryptocurrency.
Dividends are a rather old way to earn passive income on investments. Fortunately, they also apply to cryptocurrencies. Not all cryptocurrencies can pay dividends, so your research needs to be sharp on this one. Some of the cryptos that pay dividends include Cosmos, Tezos, Vechain, and NEO.
If you go this route, you should know that pay-outs aren’t going to be that large as compared to other passive income opportunities, yet they have the advantage of being steadier than most.
Perhaps the most complex way to earn passive money with Bitcoin and other cryptocurrencies is to mine them. It’s the most original way of doing it, yet it’s now growing more and more with its labor and capital intensive.
It became increasingly difficult for an individual to mine their own crypto and the activity is now mainly done by large mining farms. It used to be a good way to earn crypto, though, and it can still be if you have both the resources and expertise to do so!
3. Lending Crypto
The basic principles are the same as with cash loans – you lend your money in order to earn interest on it. Some platforms act as marketplaces. You lend out your coins to them and they lend them to borrowers while paying you good interest in the process.
To keep the transactions secure and guarantee payment, for every borrower to be given fiat currency (currencies issued by countries such as the US Dollar), they’ll need to provide crypto as collateral.
This makes the process quite safe and these marketplaces are helpful if you’re trying to earn passive income. Using this strategy, you can actually earn interest by loaning out your coins on KuCoin, a marketplace that helps make the lensing process secure and profitable for you.
The crypto market can be highly volatile, and this can be a good thing for the seasoned investor. Crypto can be a good investment to add to your portfolio and can offer a good compliment to the mainstream financial system and the USD value. The trick is to carefully watch the market and make a purchase at just the right time. The goal is to buy cheap and sell as high as you can.
To make sure you’ll sell your crypto at a good time, based on your judgment, it’s best to invest assets you’re going to view as illiquid for a significant amount of time.
A longer time horizon, as in any investment, has the potential to absorb fluctuations and shocks on the market as some losses can self-correct over time, and you still get your investment plus good interest when you eventually sell during a sharp rise in the value of your coins.
5. Staking Tokens
Nowadays, it was established that not just anyone might be able to mine crypto, the next best thing has inevitably become coin staking. This refers to the process where you loan out your coins to the network to validate transactions. The network will then reward you with additional coins, which is a sort of interest on the loan you’d have provided.
Staking is usually done better in a pool where people can combine their coins to improve their ability to validate transactions. This then increases their earning potential.
Conclusion: Achieving passive income through cryptocurrency is something you, too, can reach. All that’s needed is to know all the choices available to you and then select just the right one to suit your investment goals. If you’re a long-term investor, there are income-generating opportunities available and safer for you to embark on than the short-term investor.
It helps to research anytime you want to try out a new way and find out if the opportunity matches your overall goals and risk absorption capacity.