How to earn money with Cryptocurrency? An Ultimate Guide
How to earn money with Cryptocurrency?
When you live in the digital age, you are always looking for digital income streams. Cryptocurrency is most likely one of them, and it should be if you want to survive in the fin-tech world.
Since its inception in 2009, the crypto space has generated a fair share of wealth for early founders and investors. The crypto market cap has hit $2 trillion so you can predict the growth of this market in coming years.
Many people regret for not entering this market when they heard about it. Although we have experienced some incredible growth since the last few years, the industry is still in its early stages of development. It’s not too late.
Cryptocurrency offers several ways to earn money online. No matter how long you spend, how much money you have, even though you have no money, you can still earn with your time and efforts.
Let’s explore the best methods for earning money with cryptocurrency and later you can decide which method is best for you based on your trading psychology, your time availability, and your risk appetite.
6 methods to earn money with cryptocurrency
1- Crypto Trading
Crypto trading is somehow similar to stock trading where you buy coins/tokens and sell when you get targeted profit. This method requires practice and knowledge of the market, so be sure to do work on your trading fundamentals and understand the market behavior.
We can divide crypto trading methods into the following.
When you trade in a very short timeframe, typically 1 or 5 minutes in the market. You are a scalper! Scalpers do many trades in a single day. Even many super scalpers do more than 100 trades in a day. So, scalping is one of the fastest frequencies of trades that traders can adopt. Scalpers usually take quick decisions like either to buy, sell or stay away from the trade.
b) Day trading
Day trading is one of the most common trading strategies that traders use in the cryptocurrency market. It’s an strategy that involves opening and closing positions multiple times in a single day. Day traders usually close all positions at the end of a given day. This method requires careful technical analysis of the market and in-depth research on other factors as well.
c) Swing trading
Swing trading is a strategy of making trades over days, weeks, or even months. The aim is to generate short to medium-term benefits in the market. Swing traders buy low, wait for the increase in value of their assets, and then sell high. They also use a mixture of fundamental and technical analysis. A day timeframe is more significant and reliable for swing trading strategy.
Let’s make it precise so that we can compare these three methods.
2- Buying & HODLing
HODL is a term that means to Hold On for Dear Life. Hodling is the process where buyers buy cryptocurrency of their choice based on their research and then hold for a significant time particularly long-term. Once the price of the coin is high enough to make good profits, you can sell it on the market. “hodling” is probably more secure to investors, as investors get rid of short-term volatility and can also avoid the risk of buying high but selling low.
3- Investing in ICO/ITO
Initial coin offerings(ICO) or initial token offerings(ITO) are another way where you can invest for high returns. Moreover, it is a type of capital-raising activity in cryptocurrency. After the creation of the coins/tokens, they are offered to the investors. Investment in these coins can give you higher returns because you buy it at the very initial stage, however, there exists a high-risk factor as well because these coins/tokens are not stable at that stage.
Before investing in ICO’S you need to do in-depth research and evaluate the fundamentals including market capitalization, maximum supply/circulating of the coins, and its use cases. You can find out the list of ICO’S here.
Staking is the process of investing or locking up in a specific crypto-coin and earning new cryptocurrency in return. Furthermore, if you choose to hold your coins for a set period, you will benefit from price appreciation as well.
Many exchanges, on the other hand, offer their users staking services. Binance staking makes it very simple for you to earn rewards. You just have to hold your coins in exchange.
5- Earning with Referrals
Crypto referral is another popular way to earn money with cryptocurrency. This way you can make money without any investment. All you can do by registering on websites or exchanges that offer referral options. You will then get a referral link that you can use to earn money by inviting your friends. You can earn a 10% to 40% commission when your referee starts trading on that platform after signing up.
Airdrops are free tokens that are normally distributed through an exchange to create awareness and promote a project, it is a marketing stunt that involves sending free coins/tokens to wallet addresses of the crypto traders. To qualify for the airdrops, a recipient is required to hold a minimum quantity of the crypto coins in their wallet or perform a certain task.
There are many more other ways to make money in the crypto space, however, we just highlighted the most common and profitable methods of making money with crypto.
Now, let’s find out the trading platforms where you can Sign-up and start earning with cryptocurrency.
Similar to the stock market or forex market, you can trade cryptocurrency through centralized exchanges. There we see more than 500 crypto exchanges where you can trade virtual currencies like Bitcoin, Ether, Litecoin, Binance coin, Ripple, BitTorrent, etc. All these exchanges are working on a global level, but due to differences in laws and regulations, many exchanges do not operate in many countries. There are also many exchanges with low trading volume and less trust score. So, having these significant factors in consideration, we have shortlisted the top 3 exchanges based on the trading volume, traded coins/tokens, trust score, the popularity score, and many more factors.
Top 3 cryptocurrency exchanges
Binance is one of the best and most popular exchanges, offering more than 150 cryptocurrencies for trading. Binance supports more than 180 countries.
- This application offers a wide range of tools for trading online.
- It is one of the top cryptocurrency exchanges that provides 24/7 support to its users.
- It is compatible with Web, iOS, Android, and PC clients.
- Binance offers basic and advanced interfaces for trading.
- It does 1.5 billion average daily trading volume with more than 1.5 million transactions per second.
- It is the world’s most trusted exchange for crypto.
- You can Register on Binance in less time with an easy verification method.
Kucoin is also one of the top exchanges that provide the latest and secure platform for trading cryptocurrencies.
- It is one of the top crypto exchanges that helps you to purchase Bitcoin and other altcoins safely.
- It offers you a quick and easy way of trading.
- You can Register on KuCoin in less time with an easy verification method.
Coinbase is online for the purchase, sale, transfer, and storage of digital currency. It supports 100+ countries.
- Coinbase is one of the largest cryptocurrency exchanges
- It stores your funds in a vault for security purposes
- It provides an app for iOS and Android devices
Investing in cryptocurrency is the perfect choice if you can adjust to this market. As we discussed earlier, it’s not too late yet, however it could be late in the coming years. You may feel insecure with your funds due to the volatility of the market but on the other hand, you could fulfill all your dreams of earning huge profits with the right strategies. It’s the game of patience, in-depth research, and strong commitment.