If you've ever wondered how to make money online, you have come to the right place. In this article, I will show you different ways of how people are able to earn money online with cryptocurrency.
Cryptocurrency is an exciting new digital asset, where fortunes have been made (and lost) almost overnight. Those who got in early, believed in the potential of the technology, and took the brave step to invest their hard-earned money (and HODL-ed), have reaped the rewards.
While others who got in later have also been able to make money through cryptocurrencies.
Some might think that making money with crypto will be complicated. Well, you'd be surprised that it's actually far from that! With time and patience, anyone can master how to make money online with crypto.
By the end of this article, you'll have a better idea of the various ways that other people have made money in the industry. And you'll be able to choose the best option for yourself and start your journey.
This is probably the easiest and most common way of making money with crypto. So, how does it work?
You simply buy a coin at a lower price and hold them until their prices appreciate so you can sell at a higher price. It may take days, months, or even years, but there's a good chance you'll come out profitable in the end.
For instance, the price of BTC was around $3,500 in January 2019 and rapidly rose to $11,000 in June 2019. That's a massive profit of 214% in six months. This means that if you had bought $350 BTC in January, you would have sold it for $1,100 in June, making a cool profit of $750.
Being patient by HODLing over a long period of time can be a powerful way of making money with cryptocurrency. There are tons of coins out there that you can hold, but it might be safer investing in large cap coins like (to name a few):
There are no guarantees that you'll make a profit by investing in any of these coins. But they have (so far) stood the test of time and have a real-world application (that have yet to fully materialise).
Pros of HODLing
Cons of HODLing
To buy any of the recommended coins, try Remitano. This popular p2p platform allows you to quickly and safely purchase cryptocurrencies with your local currency and store in your account's wallet.
Day trading is another great way you can make money online with cryptocurrency. The price volatility of cryptocurrency gives plenty of opportunities for day traders to scalp quick profits on a daily basis.
Unlike HODLing, day trading - or margin trading - is highly risky. Most traders lose money and only a few percentages of traders are able to earn profits consistently. Though even the most experienced traders lose every now and again.
Day trading requires technical analysis that involves reading and analysing charts day by day. And it's definitely not the best option for crypto beginners.
If you are just learning about crypto or don't understand how price charts work, it would be better to try other alternatives. But if you have acquired the necessary skills to day trade, it could be a good source of alternative income.
Exchanges like Bitmex and Binance are two popular platforms often used by day traders. They feature a wide variety of cryptocurrencies with trading charts that have built-in indicators to help traders keep track of market movements, volatility, momentum, volume, and others.
Pros of Day Trading
Cons of Day Trading
The first type of HODLing we talked about will only make you money when you sell the coins in your wallet at a higher price. It is arguably the simplest method, but there are also other ways to HODL.
Some cryptocurrencies allow you to actually make passive income while HODLing your crypto assets - they pay you for simply holding them in your wallet. Dividend payouts vary from coin to coin. It may be weekly or monthly.
Some examples of cryptocurrencies that give staking rewards are;
Pros of HODLing for Dividend
Cons of HODLing for Dividend
Staking is another great way of earning passive income with crypto. It's quite similar to option 2, where you get a reward as dividends for owning some crypto coins.
With staking, on the other hand, you'll have to stake the coins to qualify for dividends. This involves placing your coin in a fixed wallet. This can be compared to a fixed deposit account in conventional banks.
This works based on the Proof of Stake principle (PoS). PoS requires that you hold a certain amount of a cryptocurrency in your wallet for a particular period. The period of holding is called staking.
You get your reward after staking your coin for the specified time. The more coins you stake, the bigger the reward you get. Examples of cryptocurrencies you can stake are:
Check here for detailed information about staking cryptocurrency and Proof of Stake (PoS).
Pros of Staking
Cons of Staking
Mining is the oldest and most common way to make money with crypto. Cryptocurrency mining is passive, and unlike others, all you need to get started is the mining kit.
The major downside of cryptocurrency mining is investing in mining kits. You need to invest in high-end mining kits to be a successful miner. Mining works by having a computer solve complex mathematical algorithms, and whoever can solve them gets their rewards.
The better your mining equipment, the higher your chances of getting rewarded. Also, to successfully mine, you need access to cheap and stable electricity. Besides, you need to have the technical know-how of the software and hardware of the mining kit.
If you're thinking about getting started with crypto mining, we've shortlisted a few that might help you: 5 best and cheapest Bitcoin Mining Software in 2020.
Pros
Cons
Here is a quick recap of the five major ways to earn money online with cryptocurrency
2. Buy and Hold Cryptocurrencies for Dividend
There are other ways to make money online with cryptocurrency, but the ones treated in this article are the major ways. While you are getting ready to dive right into any of the methods discussed here, please be wary of scams.
Also, getting started isn't difficult; you can start making money today by simply HODLing while you learn other methods. We recommend that you start with a small investment and increase it as you master how to make money online with crypto.
