The idea of making money with cryptocurrency sounds enticing, right? When you google anything related to cryptocurrency, you might be amazed by the number of people who’ve profited from this relatively new industry.
However, your understanding of how the crypto world works is, well…. a bit fuzzy, to say the least.
I’m here to change that today with this extensive guide which will serve as a tool to help you get up to speed on some of the more prominent ways of earning cryptocurrency in your spare time.
Within this guide, I’ll show you 17 different ways you can make money (or even a living) with cryptocurrency. Each strategy covered will be graded based on:
- How much profit can be made from the method?
- How much effort is required to make a profit?
- How risky is the method?
So without further ado, let’s get started…
1. Buy and HODL
Perhaps the most common way of making money with cryptocurrency is to invest and hold, also referred to as “HODL” within the crypto community.
Similar to what many investors do within the stock market, you can invest in certain crypto coins (which hopefully you will extensively research), hold them until the price action is well above your initial buy order, and sell them at a profit. Some of the coins you can buy include Bitcoin, Litecoin, Ethereum, and Ripple, among other altcoins.
However, be wary of the coins you buy. Before buying a token, conduct intensive research into the viability of the currency and its long-term implications in the market. Some questions that you may want to ask yourself are:
- How long has the token been around?
- What are its use cases (it’s general-purpose)?
- Do you genuinely believe in what the project is doing and trying to accomplish?
Look for projects with real world use cases and those that have been around for a while. Assets such as Bitcoin and Ethereum have been in existence for several years and are less likely to go anywhere for quite some time.
However, you don’t have to limit yourself to only tokens in the top 20 of Coinmarketcap. There are thousands of mid to lower cap altcoins that have incredible price swings you can earn a fortune off of.
Want to spread out the risk from this investment strategy?
Mix up your crypto portfolio with a variety of crypto coins in various use case scenarios (like one security coin, one privacy coin, one social network coin, etc.) that have a promise of increasing in value. Don’t only rely on popular tokens if you want the biggest bang for your buck.
2. Earn Crypto Dividends
Do you know that you can earn a passive income from your crypto investment?
Similar to what happens in the stock markets, there are crypto companies that will pay you dividends for holding their token for a specified period. Examples of coins that’ll pay you dividends include
Compared to the 2-3 percent interest that your bank pays, most of these coins pay dividends at a rate of 5-10 percent per annum. If you think about it, investing in such projects will earn you more as compared to if you’d left your money in the bank.
However, like any investment, take caution, and only buy into projects that you’ve thoroughly researched and trust.
Income: Medium (Over time)
3. Day Trading (Buy Low. Sell High)
Day trading is one of the most rewarding ways to make money in the crypto space.
As opposed to the buy and hold strategy, day trading entails holding a crypto asset for a short time frame then selling it when its value increases. This period can range from minutes, hours, or even several days, depending on the type of token.
Successful day trading requires that you keep a close eye on market. To become a successful day trader, you’ll first need to sharpen your analytical and technical skills.
If you’re a beginner in the crypto space, this method is not for you. However, if you’ve previously analyzed stock markets, day trading could be quite lucrative for you.
A word of caution: If you’re looking for a get rich quick scheme, day trading is not for you. If you don’t have any trade experience, this will be more of a get poor quick scheme than anything else.
Proof of Stake (PoS), also known as staking, is one of the best ways to earn a semi-passive income in the crypto space.
Has mining becoming unprofitable at the moment? Try staking.
What is staking?
Simply put, staking is another method of validating and recording blockchain transactions. In a Proof of Stake system, coin holders put their coins in a wallet that’s connected to the blockchain. These coins are then used to validate transactions and create new blocks.
How do you earn from staking?
Staking works in the same way as a fixed deposit account. Rather than being paid interest as you would with a fixed deposit account, you earn additional coins as a reward for being forger (users who validate transactions in PoS blockchain.)
However, staking is only available in coins that have a Proof of Stake system. Examples of these coins include:
- Decred (DCR)
With staking, you don’t have to worry about high energy prices and the high capital needed to set up a profitable mining operation. All you need to do is to ensure your wallet is always connected to the blockchain.
Arbitrage is the process of buying an asset at a lower price, then selling it for a profit on a different platform.
If you’ve been in the crypto space for a while, you’ve probably observed price variations between different exchanges. Why not take advantage of these price variations to earn a profit from your crypto assets? All you need to do is buy a coin on a cheaper exchange, transfer it to another wallet, then sell it on a platform where the currency is trading at a higher price.
However, you need to be good at research and also quick at executing trades to ensure high profit margins. There are several pieces of software out there that can help you spot these arbitrage opportunities quickly like
Mining is one of the oldest ways to make passive income from cryptocurrency is the process by which various transactions are verified and then added to the blockchain. Crypto miners require specialized hardware in order to effectively complete these tasks. Each time a cryptocurrency transaction has been completed a crypto miner is responsible for ensuring the authenticity of the transaction as well as updating the blockchain.
Unlike a centralized system where only one person (or corporate entity) is responsible for monetary control, anyone can become a miner. All you need to do is invest in equipment, set it up, install software, and let it run.
However, setting up a profitable mining operation isn’t cheap. Other than the high end hardware that you’ll need to compete favorably, you’ll also need to contend with high electricity and cooling costs.
7. Micro Earnings (Microtasks, Faucets.)
Micro earnings offer a cheap and easy way of earning from cryptocurrency. To earn through micro earnings, all you do is complete small online tasks then get paid a small amount for your time
Ever heard of Bitcoin faucets?
These are the most well-known micro earning sites in the crypto space. Faucets are websites or apps that pay you a small amount of bitcoin for completing microtasks. These tasks vary and may include filling out surveys, clicking on ads, and watching videos.
Most bitcoin faucets will pay you between 25 satoshis and 100 satoshis (0.000001 BTC) for every task completed.
Despite the low effort required, you’ll need to invest a considerable amount of time to make decent money.
Imagine if you woke up and found an extra $200 in your bank account just for allowing them to hold your money? You’d not only continue to keep your money in a bank account but you’d go around telling everyone how fantastic your bank is right?
Airdrops work in a similar fashion. These are free coins that are distributed to wallets of specific users that hold a particular cryptocurrency. Companies conduct airdrops as a marketing strategy with the aim of
- Understanding their users
- Rewarding loyal customers
- Generating awareness
- Wider distribution of tokens
- Raise funds
You can make money from airdrops in different ways. One of the easiest ways (yet uncommon) is to enroll in blockchain education programs that pay you to learn about crypto. An example of such a program is the Coinbase and Stellar partnership, where you’re paid a certain amount of Stellar Lumens for learning about XLM.
The most common ways to earn from airdrops is by investing in a particular cryptocurrency while referring people to participate in airdrops and ICOs. Some airdrops require you to participate in several steps in order to be rewarded with more cryptocurrency while others only require you to hold a certain amount of crypto for a particular amount of time
9. Crypto Writing
If you understand how the crypto world works and have a knack for words, this could be the best way for you to make money with cryptocurrency. Crypto blogs and websites are actively looking for knowledgeable people to write about bitcoin and cryptocurrency.
These websites will pay you an amount ranging from $20 to as high as $150 per post. Most crypto blogs and news sites also allow you to choose which payment method you prefer, whether that be Bitcoin or fiat.
10. Accept Crypto in your Business
If you’re a merchant (whether online or offline), you can accept cryptocurrency as a payment method. This is one of the safest ways of earning.
By choosing to accept cryptocurrency as a payment option, you enjoy the benefit of price appreciation as well as earning, however this only pertains to those who keep up with the market. For those who don’t. I highly recommend freezing the value in a stable coin like Tether or cashing out to your regions fiat.
Risk: Low-Medium (depending on if you know anything about the market or not)
11. Run a Masternode
Running a masternode is one of the best ways to make passive income from cryptocurrency.
What is a Masternode?
A masternode is a computer/server that contains the real time records of all transactions on a blockchain in real time.
As a node operator, cryptocurrency companies will pay you for maintaining the real time records of all transactions in their blockchain. However, to host a masternode, you should have a minimum number of coins in your wallet and also have an understanding of how to set up a server.
It’s a great alternative to crypto mining if you completely understand the complexities behind network administration and server protocol. However, just like cryptocurrency mining, there are a lot of electricity costs behind it.
12. Affiliate Marketing
Affiliate marketing is also an excellent way to earn you some extra crypto on the side.
Do you own a website or blog? Maybe you’re a crypto trader who enjoys writing articles and posting technical analysis among other crypto related content. If so, this should be right up your alley.
Affiliate marketing takes a similar approach to the Amazon affiliate program. You earn a commission when someone clicks on your affiliate link to either an exchange, crypto service, or token.
Income: Low-High (completely dependent upon your traffic)
13. Become a Consultant
As cryptocurrency becomes more mainstream, there’ll be a huge demand for knowledgeable people to not only spread the word, but help educate people on the various technicalities behind crypto and blockchain technology. Consultants will have a huge role to play in guiding industries into the blockchain revolution.
Are you in the health, manufacturing, supply chain, accounting, legal, or real estate industries? You can earn a lot of money learning about the various uses for blockchain and other crypto related technologies. By being a noteworthy blockchain consultant in your industry, you can easily generate a full time living off speaking at seminars, posting webinars, and other crypto/blockchain related industry events.
14. Become a Blockchain Developer
By being a blockchain developer, you’ll be responsible for creating decentralized applications, therefore, at the forefront of the decentralization movement. The hefty paycheck that comes with being a blockchain developer is definitely worth the time learning this sought after trade.
15. Start a Blockchain Project
Do you have an idea that can change the world? Can you offer a solution to a problem that’s plaguing your industry? Perhaps you have, with a new raw material tracking system or a way to promote accountability.
Why not develop it through a blockchain platform.
With blockchain being expected to revolutionize a myriad of industries, starting a blockchain project is a viable way to grow a career and earn cryptocurrency. In the past decade, numerous people have made a fortune after creating blockchain-based solutions to solve problems in different industries.
So, if you’re feeling innovative and have the skills and determination to bring your creation to life, consider starting a blockchain project.
16. Crypto Lending
With interest rates of up to 20% per annum, lending is a great way to increase your crypto wealth, however, it’s also extremely risky. Although there are platforms that link lenders to borrowers, no insurance is provided for your money. Stories of lenders being left without their lender money have become rampant for those who risk their money on “get rich quick” lending opportunities.
Stick to more prominent insured companies and exchanges that guarantee you reasonable profits for your capital. If the interest rate seems too good to be true, it is. Some of the more safe investment channels are …
Income: Medium-High (dependent upon how much you lend)
17. Crypto Gambling
Do you consider yourself lucky or have a bit of skill in poker or blackjack?
Why not try your luck at one of the latest and most innovative online casinos today, crypto casinos.
Crypto casinos offer you a chance to increase your crypto wealth through different gambling opportunities. Best of all, they do not require personal information like your driver’s license, passport information, billing information, etc. like many other fiat based online casinos require. With any major cryptocurrency, you can get started playing up to 500+ unique games in a matter of a few minutes
However, when choosing a casino, ensure that you’re using a fair platform (called provably fair) where you’re allowed to check if the results of your game are random.
A few the most noteworthy provably fair casinos to date are…
Income: Low to High (dependent upon how much you gamble)
How to Make Money with Cryptocurrency: Final Thoughts
There you have it. 17 various ways you can make money from cryptocurrency. As you can see, every method has its own set of pros and cons. Some are obviously riskier than others, while others offer higher chances of earning with lower risk. It’s up to you to evaluate which ones will suit your own personal needs.
In the meantime, try a few out and let me know how it goes in the comments below.