It’s impossible these days not to hear about cryptocurrency. Whether you’ve tuned in to some of the things that Elon Musk has said about it, watched the turbulence of Bitcoin, or have friends who are obsessed with it, crypto is starting to become a mainstream topic. As a result, many people have been able to make money with cryptocurrency.
There isn’t any reason that you can’t be among those people who get paid in crypto. So if you’ve been looking for creative ways to make money, cryptocurrency should be an avenue to consider. We’ll break it down here to show you how to make money with cryptocurrency.
What Is Cryptocurrency?
You may have steered away from looking at ways to make money with cryptocurrency because you’re not sure what it is. Cryptocurrency is a digital currency that can be used as a form of payment to exchange goods and services online. Companies may create and issue their own currencies, which are typically called tokens. These tokens are traded for the goods or services that the company provides.
A good way to think of cryptocurrency is like casino chips that you exchange for cash when you’re gambling. To access the goods or services, you need to exchange real currency for cryptocurrency.
Blockchain is a technology that enables cryptocurrencies. It is a decentralized technology spread through computers and acts as the system of record for those transactions. That helps cryptocurrency to be secure for online transactions. This security is a primary reason that this technology has grown in popularity.
Other reasons that cryptocurrencies are so popular today include:
- Supporters believe that cryptocurrencies will be the future currency; They wish to purchase them now before becoming more valuable in the future.
- Since cryptocurrency removes central banks from managing the money supply, the belief that cryptocurrency can reduce inflation
- People believe that the decentralized processing and recording system is more secure than traditional payment methods
You’ve probably heard of Bitcoin, which could be considered the poster child for cryptocurrency. There are well over 10,000 different types of cryptocurrencies out there.
Cryptocurrencies raise money through initial coin offerings or ICOs. Other notable cryptocurrencies include Ethereum, Tether, Binance Coin, Cardano, XRP, Dogecoin, Polkadot, and USD Coin.
How Do I Buy Cryptocurrency?
One of the best ways to make money online is through cryptocurrency. However, if you want to start using any of the ways described here to make money through crypto, you need to get a “wallet.” This wallet is an online app that is capable of holding your currency. There is also a hardware wallet, which is an offline device similar to a flash drive that you can use.
You can skip this step completely by using an exchange app like Coinbase, where you connect your debit card or bank account. This way is typically the fastest way to start buying and trading crypto.
If you’re seeking other ways to make money with crypto, then you might need to find a decentralized finance platform. DeFi, as it is known for short, is a system of peer-to-peer finance tools. Depending on the platform, you may have options like loans, interest accounts, and advanced trading.
DeFi is highly disruptive of the traditional finance system. That is because it works by removing banks, lawyers, brokers, and other middlemen from the finance process. Supporters of DeFi say that removing these middlemen from the process makes finance more affordable, faster, and transparent. It also eliminates the potential of in-personal discrimination and allows for more democratic transactions.
The world of DeFi takes a bit more research to make money than using the exchanges. This is because there are different DeFi protocols, which are the functions they enable you to do. For example, if you put your crypto in a savings protocol, it works similar to how it works when you put cash in a savings account. You earn interest on the crypto that you have in the savings protocol for using their service.
How to Make Money with Cryptocurrency
Let’s move on to talk about the creative ways to make money with crypto. We’ve compiled some ideas on how you can get paid in crypto. Keep in mind that you’ll want to do more research once you’ve identified the methods you want to try out. Making money with cryptocurrency is one of the best ways to make money online, but it does take some time and effort.
Investing in Cryptocurrency
If you want to earn crypto online, investing is the easiest way to make it happen. As we know, investing takes a long-term view to buy and hold assets that crypto assets are well suited for. In the short term, cryptos tend to be highly volatile, but they have the potential to be a great long-term strategy for making money. This way is very much like how investing in the stock market for the long term has been widely shown as a viable way to make money.
You can invest in cryptocurrency in many different ways, including an ICO, direct investment, or partnership, or through one of the exchanges.
Your crypto investments will earn you money through the price appreciation of the coin or token you buy. You could also make returns through your share in a project. It will depend on the type of cryptocurrency you invest in and what project or product you will access. Alternatively, you can use the coin for payments.
Crypto mining is a process that creates a new cryptocurrency that is then entered into circulation. It uses sophisticated computers that work to solve complex math problems. The crypto mining market has been very appealing to many investors because they earn crypto tokens for their work.
Bitcoin is the most popular type of cryptocurrency that’s been mined. Miners receive the coin as a reward for completing “blocks” of verified transactions that will be added to the blockchain. A miner that finds the solution to a complex puzzle first may also earn mining rewards. The chances that a participant will be the one to uncover the solution is related to the portion of the total mining power that’s on the network.
To start cryptocurrency mining, you’ll need a graphics processing unit (GPU) or application-specific integrated circuit (ASIC) to set up a mining rig. In addition, you’ll need to do extensive research to ensure that you’re coming out ahead if you want to earn crypto passive income. Mining requires an investment in equipment, and the process consumes a lot of power that might not be worth the price in the end.
You can think of cryptocurrency dividends working similar to how stock dividends work. To earn passive income with crypto, you would need to invest in a dividend cryptocurrency through dividends. On your investment, you would earn fixed interest.
The amount of time you hold the cryptocurrency will depend on how much interest you wish to earn. BNB and NEXO are two examples of dividend cryptocurrencies that you can invest in. However, you don’t need to stake in these coins to earn interest.
Staking and Lending
Here is one way to earn passive income with crypto that’s called staking. It is referring to the process of locking up or investing your funds into a crypto-coin. As a result, you earn new cryptocurrencies that come in the form of interest. Price appreciation of the coins you decide to hold during that period is another benefit of this method.
Let’s look at an example to see how this would work. WISE is an ERC-20 token that allows you to earn interest by locking your funds in the WISE contract. You can make up to 5 percent interest yearly on your stakes, plus regular bonus offers. In addition, you can withdraw your interest or liquidate your stake at any time, which makes WISE staking a low-rise, flexible, and secure way to make money.
Cold staking is also another way to make money with crypto. With cold staking, investors stake coins and hold them in a secure offline wallet. Stellar, NEO, and Tether are some of the coins out there that allow you to stake.
Lending coins in the network is another way that investors can make money with crypto. By lending out crypto to other investors, you can earn interest on that loan just like it works with a loan product from a bank. To lend crypto, you need to find a platform that facilitates this type of use. You can find these through exchanges, peer-to-peer lending platforms, and decentralized finance (DeFi) applications.
Just like stock trading, you can partake in crypto trading to make money. By making buy and sell decisions on tokens or coins, you can create profits. The key difference in this strategy from investing is the time horizon. Trading crypto is a strategy that seeks to exploit short-term opportunities.
Several different exchanges are available where you can buy/sell cryptocurrencies for you to choose from. Coinbase, eToro, and Gemini are a few examples of cryptocurrency exchanges.
To earn crypto online with trading, you can buy different currencies then hold them for a while. Or, as soon as the price goes up on a coin/token, you can sell it immediately for a profit. Another option is to do day-trading with crypto. It involves buying and selling cryptocurrencies on the same day. Day-trading is a much riskier venture and will require more time and effort to make money.
Buying and Holding
A crypto passive income method that you might try involves holding cryptocurrencies for a long time. By using the HOLDing method, you find the best cryptocurrencies out there with solid use cases and will hold them with the hope that their prices will increase significantly.
Once the price has gone up enough for you, then you sell them in the market to make a profit. The disadvantage of this way of making money through crypto is that you don’t earn any interest in your funds.
Earn Bonus Coins or Tokens
You don’t need to invest anything when you participate in a bonus or airdrop offer that allows you to earn with cryptocurrencies. To get some free or bonus coins, all you need to do is point to a bounty or airdrop program of a cryptocurrency. You then will complete some easy tasks to earn the coins or tokens.
Another way you can get some bonus tokens is by investing during an ICO in a cryptocurrency or the token sale phase. It’s common for early investors to be offered bonus tokens when a new project is underway.
Microtasks with Cryptocurrency
If you’re looking for a way to make money with the idle time you have, try helping out small tasks and get paid. Of course, the type of tasks you’ll be doing will vary. For example, you could be asked to watch videos, take surveys, test apps, or other small tasks. This microtask can earn you Bitcoins Rewards, Coinbucks, or other rewards.
Work for a Company in Cryptocurrency
Working in cryptocurrency is certainly not a way to earn passive crypto income, but it’s very common in this industry. Working for a cryptocurrency company in any capacity can offer you compensation in terms of cryptos. So if you are a content creator, digital marketer, etc., you can make money with crypto with the skills you bring to the table.
This way is also a great option for those of us who prefer working from home. Working for a crypto platform generally means that you’ll be working remotely. So you never need to worry about morning rush hour and can create a nice space that’s yours to work from at home. In addition, since many of these companies will offer their compensation in terms of cryptos, you could earn double a few hours or days of work.