By now, you’ve probably heard all about cryptocurrency and how people are making money from it. Based on blockchain technology, cryptocurrency can act as both a medium of exchange and an investment vehicle and there are thousands of them available to buy and use.
And with the number of crypto users only increasing every year, FOMO can easily set in.
But how do you make money from crypto? It can all seem very vague and mysterious to an outsider but there are several ways to make money using digital assets. From trading to mining, here are some options to consider.
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Trading Speculatively
This is perhaps the most common way to make money from crypto and essentially means treating tokens like stock. You buy a crypto asset at a certain price and then resell it when its value goes up, netting you a profit.
There are a number of things to keep in mind if you do this, however. There are hundreds of tokens in the market and there is no surefire way to tell which will go up or down in value. You will also have to avoid pump-and-dump schemes, shitcoins, and other shady crypto ventures.
However, if you can find the right tokens and make trading moves at the right time, the sky is the limit.
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Gambling
Believe it or not, it is possible to gamble with cryptocurrency. This is thanks to the myriad of crypto casinos that let you wager dozens of different tokens and play every game you can imagine, from poker to Plinko. By using these sites, you could possibly multiply your crypto stash while also enjoying more privacy and control than you would have at a traditional casino.
All these benefits have made crypto betting sites a fun way to use tokens, and they are growing increasingly popular among consumers. Getting started is relatively easy as you need only sign up, deposit your token of choice, and start playing.
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Mining
A common way to get your hands on cryptocurrency is by ‘mining’ it. Mining refers to the process through which new tokens are brought into the world, provided that they are based on a proof-of-work blockchain. Mining requires specialized computer systems to complete mathematical puzzles in order to confirm transactions completed on the blockchain.
As a reward for completing these puzzles, the miner is given a certain amount of tokens.
Keep in mind that there are certain factors that make mining more or less profitable. The number of rewards per Bitcoin block is cut in half every few years and mining uses a lot of electricity. However, you can choose to join a mining pool or leverage cheaper energy options to do this.
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Staking
If a crypto is based on a proof-of-stake network, it cannot be mined by interested users. Instead, it can be staked to earn interest. Staking essentially means committing a certain amount of the tokens you already own to the network and receiving interest after a period of time elapses.
Staking is a very popular way to earn crypto because it is relatively low risk and creates a passive stream of income. If you’re a more risk-averse investor or want a passive income source, this might be the best option for you.
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Lending
Many people around the world want to borrow crypto for various reasons and this has given rise to a prolific crypto lending scene, which is also a way to make money off your existing tokens. It is as simple as signing up for a lending platform and listing your tokens.
Anyone interested in borrowing them can do so with an agreed interest rate and once the time comes, you will get your tokens back with interest. Most of the lending platforms on the market use smart contracts and custodial services which make sure that your tokens are returned when they are due. And just like with staking, it can offer a source of passive income.
Conclusion
The crypto market is full of opportunities for investors to make money and these only increase over time. As we’ve highlighted in this article, you can make money by trading tokens speculatively, staking, mining, gambling, and so on. Whatever your preferences in tokens, your risk tolerance, or your level of experience, you will probably find something that works for you.
In all of these, make sure that you take necessary precautions by doing your research before investing in any token, platform, or project. And, of course, keep your tokens safe at all times.
