As the awareness around cryptocurrencies keeps growing, so do the passive money-making opportunities around them. We have come a long way from traditional mining of Bitcoin through Proof of Work and today there are newer ways to earn income. Investors who jumped on the crypto bandwagon early and held on to their assets managed to multiply their fortunes but is it too late today to make money from cryptocurrency? The answer is no.
If you have already invested in cryptocurrencies or are planning to, we bring to you strategies that will let you add extra income to your crypto investment.
Investors must remember that the crypto market is volatile and they must tread carefully to avoid losing their initial investment. It is crucial to do your own research (DYOR) before making any moves.
Let us dive in to find more –
This one is an absolute no-brainer but just like investing in stocks, investors can buy the coins they are interested in and wait for their value to rise. Once the market moves, you can sell at a profit. Few exchanges offer interest for holding crypto assets in their digital wallets. We shall explore these options in the points below.
Staking is a mechanism where users lock their coins in a crypto wallet to help secure a blockchain in exchange for being rewarded in cryptocurrencies. Staking helps in securing and processing transactions on the network. Instead of letting their crypto assets lie idle, long-term investors are keen to stake their coins to earn potential returns.
Platforms like Crypto.com, Celsius and BlockFi offer between options to stake from flexible, one, two or three months with an interest ranging between 5% to 15% on different cryptocurrencies. For instance, Binance staking offers up to 32.34% APY for staking few assets.
Ethereum-based iOWN Token will be available for staking in the future. The token’s core utility is to enable users to participate in equity crowdfunding campaigns on the iOWNX platform.
3. Crypto Lending
Each cryptocurrency exchange operates differently and not everyone lets the investor lend out their crypto. The interest rates that investors can earn vary depending on the currency they loan out and the type of loan.
There are flexible and fixed types of loans. While the fixed exchange allows investors to deposit for a predetermined interest typically for seven days to 90 days, you can withdraw your crypto anytime in a flexi arrangement. Obviously, the rate for locking for a longer period in fixed pays higher interest than flexible. Some exchanges or platforms pay a daily APR allowing you to earn compound interest on the crypto investments. For instance, rewards on Celsius network are calculated every Friday and distributed every Monday.
Years back, miners invested in different types of hardware like ASICs to mine Bitcoin but today a mining software can handle the process. A cryptocurrency mining software will connect your machine to the blockchain to transform it into a mining node.
The software delivers the mining hardware’s work to the entire network and transfers the completed work from other miners on the network. Users can view stats like hash rate, temperature, speed of the fan, etc. For example, to mine Ethereum, many users opt for Ethminer, which supports GPU hardware like AMD and Nvidia.
5. Yield Farming
Yield farming involves locking up funds in a liquidity pool on a DeFi platform to earn interest. Yield rates keep changing on different platforms and is the main reason why stickiness is a problem for these platforms as liquidity providers keep moving.
Platforms like Uniswap, Pancake Swap, Aave, Curve finance offer between 2.5% to 250% Annual Percentage Rate (APR). As an investor, you have the chance of earning far more rewards through yield farming over staking.
6. Cryptocurrency Airdrops
Cryptocurrency platforms offer airdrop when they want to expand their user base and introduce their currency to new users. Developers give away free coins to participants for using the platform.
The best way to find if any airdrop isn’t fake is to check the company’s website, their social media pages and crypto news websites. Coinbase has a dedicated section, which runs Learn and Earn campaigns for various currencies to introduce their product and offering to new users.
Similarly, iOWN Token hosted a ‘Learn & Earn‘ campaign in March 2021 offering 1,000 iOWN Tokens to 150 winners. Users were able to understand the utility of the ERC223 token to participate in the soon-to-be-launched crowdfunding platform, iOWNX. We will be doing another airdrop in the coming months, so stay tuned to our social media pages.
7. Referral Bonuses
To encourage more people to use their services, few cryptocurrency exchanges offer sign up and referral bonuses that you can keep track of. For example, Crypto.com offers up to USD $2,000 (in CRO) for every friend referred along with 50% on the new user’s trading fees. Binance offers their users 20 to 40% of the new referral’s trading fees, Gemini gives away $10 to both, the existing and new user for any trade made within a month of signing up.
8. Stay In The Loop
Developers keep introducing newer ways for users to earn free cryptocurrencies for using their platform and the best way is to follow relevant crypto pages on social media. For example, THETA.tv rewards TFuel to anybody streaming or watching content on THETA.tv. It utilizes unused internet upload bandwidth to encourage creators to participate in the ‘Creator Monetization’ model and upload and share videos on THETA.Tv. iOWN Token’s official channel is now live on THETA.tv and is hosting a variety of educational and engaging content about the blockchain and cryptocurrency space.
If you are an experienced trader and can read the market and charts, the best way to earn an income is through crypto trading. But if you are a beginner or are still building your knowledge, there are multiple ways to grow your initial investment. DOYR and find what is the best approach for you depending on your risk appetite.
Did we miss anything? Comment below to let us know what is the best way in your opinion to earn passive income through cryptocurrencies.