You might already have your money tied up in wallets like Coinbase or FTX and are looking for ways to earn money with the cryptocurrency that’s just sitting there.
Of course, you can get into day trading and try your luck to earn money there, but that’s still a daunting task for many cryptocurrency investors.
Therefore, we’ve compiled the top 4 ways to earn money with cryptocurrencies.
So, without further ado, let’s get started.
How to Earn Money with Cryptocurrency
Here are 4 top ways to earn money with cryptocurrency.
1. Crypto Lending
You can earn extra money from your cryptocurrency investment by lending it to other parties. Cryptocurrency lending requires the participation of lenders (you) and borrowers and an agreement between them.
Crypto exchanges like Nexo, BlockFi, SALT Lending, Celsius, and Oasis support lending. You, as a lender, can lend your cryptocurrency for interest in the form of additional crypto assets.
Although this method of earning money with cryptocurrency has its own risks, you should always go with more reliable and established platforms to limit the risk.
2. Crypto Mining
Mining is an inseparable element of the Proof of Work (PoW) consensus mechanism of cryptocurrencies like Bitcoin. It is the process of authenticating transactions and recording them in the blockchain to secure the PoW network.
Miners are awarded cryptocurrencies in return for their efforts to validate transactions in the network.
You need specialized mining hardware (meaning powerful computers) to get started with this method of earning money with cryptocurrency. All the miners in the network compete to solve cryptographic puzzles, and the one who gets it right first is awarded the chance to add the authenticated block to the network.
3. Crypto Staking
Staking is a more novel approach to validating crypto transactions. Crypto owners who participate in staking have to lock their coins in their wallets for a specified period.
Why? Let’s dig in.
Staking is a part of transaction validation in Proof of Stake networks. The Proof of Stake is a greener approach than the Proof of Work system.
Unlike Proof of Work, the stakers in the Proof of Stake mechanism don’t have to invest a considerable amount of money in infrastructure (computer hardware). Instead, they can stake their coins as a guarantee of the authenticity of the transaction validation.
In the staking method, the right to add the validated block is awarded to those who stake more crypto for a longer period of time.
You can earn high rewards if you stake with a less-popular cryptocurrency. Whereas for popular and established cryptocurrencies, the staking rewards are comparatively meager.
Here are the annual average yields for some well-known cryptocurrencies:
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Tezos (XTZ) – 6%
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EOS – 3.2% as of April 2021
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Cosmos (ATOM) – 7% as of Mid 2021
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Ethereum – 5-17%
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Polkadot (DOT) – 12% as of Mid 2021
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Cardano (ADA) – 24% as of Mid 2021
4. Airdrops
Airdrops are free money. If you’re an active crypto investor or an enthusiast that keeps exploring all the new platforms, you’re most likely to receive crypto airdrops.
Crypto airdrops are free crypto deposits made by new cryptocurrency platforms or companies to boost awareness about their crypto.
Airdrop projects are prevalent among new players in the crypto market, and you should keep an eye on them to receive the free tokens.
Here is how to ensure that you receive airdrops:
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Be an active participant in the crypto community by interacting with people on forums and threads.
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Sign-up for a popular crypto wallet and invest in cryptocurrency.
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Look for airdrop-related news on social media by searching for #cryptoairdrop.
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Frequently check crypto airdrop websites like airdrops.io to know about upcoming airdrops.
Conclusion
The cryptocurrency market is new, and a lot is happening in the background. We’re seeing more and more novel ways to earn money with cryptocurrency with each passing day. So stay tuned for crypto-related news on Twitter and other social platforms to maximize your earnings.
