How to Make Money with Cryptocurrency in 2022
There are many ways to make money from cryptocurrency. The traditional way is to buy and hold tokens. In 2022, with the developments in the industry, there are ways to generate returns through staking (forging a blockchain network by holding its native currency in your wallet), airdrop campaigns (free coins distributed for taking part in games or social media tasks) and more.
Explore this guide to learn more about how to make money with cryptocurrency.
Can You Make Money With Cryptocurrency and Is It Safe?
Yes, you can earn money from cryptocurrency. There is immense growth potential in this aspect of financial opportunities as the industry is up and coming. Before investing in any financial asset, ensure you assess your risk appetite and gauge the market's volatility.
Cryptocurrency trades are 1% of the foreign exchange market but this number is steadily increasing by the day. To start your crypto journey, you can explore stablecoins like Bitcoin and Ethereum. Additionally, Cardano, Polygon and Tether are some coins that are up and coming.
One of the easiest ways to start your crypto investment journey is on Pillow! You can buy, hold and earn a fixed percentage on your investments.
Investing in cryptocurrency is safe; however, before making any investment decisions you should know the project's tokenomics and determine its value. Diversifying your portfolio can help protect you from unsafe investments without setting you back financially.
13 BEST Ways To Make Money with Crypto
Investing in Crypto
You can directly invest in crypto through centralised exchanges or crypto wallets like MetaMask. You can invest in stablecoins that have been well-established like Bitcoin and Ethereum. Additionally, you can explore upcoming altcoins as well. You can directly invest in Initial Coin Offerings (ICOs) to explore newly released currencies. Investing directly in crypto carries lesser risk than other ways to make money with crypto.
Crypto mining is generating new coins and verifying new transactions for tokens like Bitcoin and more. Blockchain technology allows for transactions to be verified and secured through decentralized networks of computers around the world. Crypto mining requires both high technical knowledge and large investments of capital.
Crypto Day Trading
Crypto-day trading is a strategy used by traders to capitalize on the fluctuations in cryptocurrency prices that occur during a single day. Day trading can be profitable if you have a set strategy and a solid understanding of fundamental analysis. You need an awareness of price action, chart patterns, and other indicators to make the most of these gains.
Buy and HODL
If you cannot keep up with Intraday trading, the best option for you to earn money through crypto is by buying & HODL-ing tokens. Over time, passive gains accumulate and provide interest on your money. You can buy and HODL through a centralised exchange or decentralized wallet service.
Staking and Earning Interest
Staking is a method of earning rewards for holding cryptocurrency. If the platform you’re using supports staking (like Ethereum does), you can earn an income from your holdings by “staking” some amount and receiving a percentage-rate reward over time
The blockchain can use your crypto as collateral so that it will be more likely to earn rewards. Cryptocurrencies with staking functions use a "consensus mechanism" called Proof of Stake, which is how they validate transactions without using banks or payment processors. You can get your crypto involved in this process by choosing to stake it.
Staking is generally open to everyone who wants to participate, though becoming a full validator usually requires some initial investment (to buy the underlying cryptocurrency), technical know-how and a dedicated computer that can perform validation 24/7 without downtime. Participating on this level comes with security considerations and serious obligations: if a validator holds up the network, their stake can be slashed.
Crypto Games (Play-to-Earn)
NFT-driven P2E or Play-To-Earn games allow users to take complete ownership of in-game assets that can be minted as NFTs on the blockchain. Weapons, in-game currency, skins and virtual land are some items players can earn or purchase or even sell for profit, just like the mechanics of a regular NFT.
Player feedback is constantly taken into consideration to improve the experience. Usually, groups of players come together to form a DAO (Decentralized Autonomous Organization) to feel a sense of community amongst the P2E user base. As players participate in the in-game economy, they generate value for other players, and the developer, too. Some popular P2E games are Gods Unchained, Axie Infinity, The Sandbox and Decentraland.
Cryptocurrency arbitrage is when investors buy a cryptocurrency on one exchange and sell it on another exchange for a higher price. Cryptocurrency is traded on hundreds of platforms and the prices vary across the board. Crypto markets are not regulated for a centralized price, hence, prices of different crypto vary on different platforms. The arbitrage can depend on the trading volume on the exchange along with crypto trading fees.
Buy & Exchange NFTs
NFTs or Non-Fungible-Tokens are unique digital assets that are not replaceable with other assets. NFT is proof of ownership in digital form and is based on the ETH blockchain network. NFTs are popular amongst artists and art collectors. To earn money from NFTs, you can create or mint your own NFTs. Renting, trading or earning royalties are all possibilities to make money through NFTs. Consumer interest is the key factor driving the price of an NFT.
Crypto airdrops are hosted by new and existing crypto platforms. Some projects share free tokens with members of the community as a part of a larger marketing initiative. The key objective is to send newly minted tokens to multiple individuals with the hope of engaging new users. The purpose is not to get the potential user to spend money but it is to raise awareness for new projects and services. Airdrops are issued when users complete certain tasks such as following an account or resharing content on social media.
The tokens you receive in an airdrop can massively scale in value if the token starts trading on an exchange. Crypto airdrops that are legitimate will never ask you to make any investment.
A DAO or Decentralised Autonomous Exchange is a blockchain-governed organization working towards a common purpose and mission. There are no organizational titles like a CEO or a CFO. Blockchain-based rules define how the organization should function as well as how the funds are spent. Organizational decisions are approved by pre-decided proposals to ensure transparency across the board.
The best DAOs share capital with their participants through a native token. You can also just simply buy it. If DAO succeeds, every token owner can sell it with a profit. Thus, the potential gains along with voting rights make possession of a DAO token much more valuable than having any other token.
Cloud mining is an alternative to crypto mining. PoW (Proof of Work) currencies need a considerable amount of investment in terms of hardware and technical knowledge. With cloud mining, one can rent hashing power from an already existing operation. This is done in exchange for a fee. It is possible to buy cloud mining contracts for a fixed hash rate for a certain time frame. The contract owner will receive new coins of the new token based on the agreed contract.
There are several cloud mining scams. Ensure you verify sources before exploring investment in this area of crypto.
Yield Farming and Lending
Yield farming is a popular way of increasing crypto holdings through lending. You can put your coins to use and grow the passive returns on them. Once money gets added to the liquidity pool, interest rates can rise when the demand is high. Investors can earn passive income from profit from rewards, transaction fees, interest, and price hikes.
Crypto faucets are applications, platforms or websites that enable users to earn free crypto rewards. Users complete simple tasks such as playing mini-games or solving puzzles to earn free crypto rewards. Crypto rewards are usually small and amount to a reasonable amount that users can redeem later.
How Can I Invest in Crypto?
You can invest in crypto through various sources. Centralised exchanges and decentralised applications can help you start your crypto investment journey. Although, it may be hard to ascertain how much money to put in which token and for how long.
For this reason, you should check out new investment options in crypto on the Pillow App! You can invest in the MATIC case and earn a fixed 20% return on your income. Additionally, you can invest in popular cryptos like bitcoin and Ethereum! There are no transaction fees on the platform. All you have to do is sign up and start investing!
There are multiple ways to earn money through cryptocurrency. Buying and holding, staking and trading are very accessible to the common man and are widely available to invest in.
Investing in cryptocurrency is safe. Ensure you have assessed your risk appetite before diversifying your portfolio to this area of investment. Additionally, ensure you research where your money is being stashed to avoid facing the consequences of unwarranted risks.
How do I make a monthly income from crypto?
Yes, you can make a monthly income from cryptocurrency. These assets may not suit your risk appetite. Ensure you do your research before investing in crypto.
What's the best crypto to buy for beginners?
Beginners can explore stablecoins such as Bitcoin and Ethereum. Additionally, curated plans based on your investment and risk appetite can be explored on Pillow.
How long should I hold my cryptocurrency?
The amount of time you should hold your cryptocurrency is subjective. If you are in the game for long-term gains, hold your investment for at least 6 months. You can hold it for up to 5 years, based on the token you have invested in.
How can I get Cryptocurrency free?
You can earn additional crypto rewards through Play-To-Earn games or staking. Additionally, you can get free cryptocurrency through airdrops.
How much should you invest in crypto to make money?
The amount you should invest in crypto depends on your risk appetite. To begin with, you start investing 5 to 10% worth your portfolio in crypto.