There are many ways to make money in cryptocurrency markets. This includes not only buying and hodling( holding) digital currencies in the conventional sense - but also through staking, interest bearing accounts, airdrop, play-to-earn games and many others.
In this beginner's guide, we discuss 10 proven methods for making money with cryptocurrencies in 2022.
10 ways to make money with cryptocurrenciesą
If you are wondering how to make money from cryptocurrencies now - consider the 10 methods outlined below.
1. investing early in promising cryptocurrencies - the best way to make money from cryptocurrencies
2. staking and interest - earning passive income from owned cryptocurrencies
There are two notable concepts in the cryptocurrency markets that allow you to earn passive income from inactive cryptocurrencies you own. The first of these is cryptocurrency staking, which involves locking up its tokens for a period of time to help validate transactions on proof-of-stake blockchain networks.
Examples of leading staking networks are Cardano, Tron, and soon - Ethereum. Importantly, you will receive interest as long as your tokens are staked. Therefore, if you engage in staking on a platform eToro, you will not have to comply with the minimum blocking period. Instead, you can withdraw your tokens at any time.
The second concept to consider when learning, how to make money with cryptocurrencies in a passive manner, is the interest account. In its most basic form, cryptocurrency interest accounts work in a similar way to a traditional bank. This is because when you deposit your cryptocurrency tokens, you receive interest.
However, unlike staking, your cryptocurrency tokens will not be deposited in a smart contract. On the contrary, your chosen provider will lend your tokens to those who need to borrow funds. Consequently, the borrower will pay you interest as long as the tokens are lent.
Currently, the best cryptocurrency savings account on the market is offered by Crypto.com. This reputable platform allows you to earn 14.5% per year on Bitcoin and Ethereum deposits and 12% on stablecoins such as Tether. All accounts offered by Crypto.com are flexible. What's more, you can even deposit funds in fiat money and buy cryptocurrencies through the app ,for more information, see our guide -. Crypto.com card review.
3. Day Trading - Make money by trading cryptocurrency pairs
One of the most lucrative ways to make money from cryptocurrencies is to actively engage in daytrading. However, there is a catch - you need to have at least a basic understanding of how to analyze prices to determine whether a token is likely to rise or fall in value. If you can do this, you can make money trading cryptocurrencies throughout the day.
The overarching concept of cryptocurrency daytrading is to seek to take advantage of short-term volatility. Moreover, experienced traders in this market rarely - if ever - hold a position for more than a day. As such, the goal is to open multiple positions throughout the day, making smaller but frequent profits.
To trade cryptocurrencies during the day, you need to find a regulated cryptocurrency exchange that meets two basic criteria - low fees and support for multiple markets. Regarding the first of these criteria, if you trade cryptocurrencies during the day on an exchange that charges high fees, you will find it difficult to make the process profitable. Eventually, your profitable trades will be eaten up by commissions.
For example, Coinbase charges 1.49% - which means you have to cover this fee before you can close the deal at a profit. eToro, on the other hand, is much more competitive. What's more, eToro gives you access to dozens of leading digital currencies, so you'll never run out of daytrading opportunities.
4. HODLing - invest in cryptocurrencies and hold them long term
This method from our list of ways to make money with cryptocurrencies is probably the best option for beginners. This is because HODLing - which is a play on the word "hold" - simply refers to the process of buying a cryptocurrency and holding on to your tokens for the long term. This is no different from buying a stock and holding it for several years.
This way you don't have to worry about short-term price fluctuations - especially when you invest in solid and proven cryptocurrencies such as Bitcoin and Ethereum. For example, in May 2021, the price of Ethereum was $4,300 per token. Just a month later, the Ethereum price fell to a low of $2,100.
If you had panicked and sold your ETH tokens, you would have suffered a loss of about 50%. However, if you had engaged in HODLing - Ethereum was trading at nearly $4,900 per token last November. This is just one of many examples. The bottom line is that the most effective way to invest in cryptocurrencies is a long-term strategy.
Once again, to HODL your investments in the best way possible, you need to find the right exchange. eToro also fits the bill, as you can invest in 60 leading cryptocurrencies from as little as $10, enjoying industry-leading fees. What's more, this exchange is approved by the relevant licensing authorities in the US, so you'll be able to HODL safely and for the long term.
5. cryptocurrency Play-to-Earn Games - Earn rewards for playing cryptocurrency games
When thinking about how to make money with cryptocurrencies, you might be surprised to learn that you can do it by playing games. Make no mistake - the play-to-earn cryptocurrency game market is currently worth billions of dollars. There are many variations and types of titles in this space, yet arguably one of the best cryptocurrency games to play is Decentraland.
Simply put, Decentraland offers a metaverse that allows players from all over the world to create a virtual avatar, chat with other people and, most importantly, buy plots of land. Once you purchase a plot of land and build your own real estate project, it is represented as a unique NFT.
See - Best metaverse projects
You can then sell your NFTs on the open market. While the concept may seem far-fetched, some plots of land in metavers Decentraland have been sold for millions of dollars. This means that by investing early enough, you have the chance to buy NFTs at the best possible price.
6. Yield Farming and Cryptocurrency Lending - Generate attractive interest rates on your cryptocurrencies
Another way to make money with cryptocurrencies that is not difficult for beginners is yield farming and lending. Although both of these investment concepts allow you to earn passive interest, they actually refer to slightly different methods. First and foremost, cryptocurrency yield farming refers to the process of lending your inactive tokens to a liquidity pool.
In the vast majority of cases, you will be providing much-needed liquidity to decentralized exchanges. Leaders in this market include Pancakeswap i Uniswap, operating on the Binance and Ethereum blockchain networks, respectively. When you deposit funds into a liquidity pool, they are often blocked for a minimum period of time.
As long as the tokens are in a liquidity pool, an interest rate is paid. In many cases, the newer and less liquid a cryptocurrency is, the higher the corresponding APY rate offered by the pool.
As for cryptocurrency lending, this refers to the same concept we discussed earlier - it involves the user depositing his cryptocurrencies into a savings account.
In this way, your tokens will be lent to those who want to borrow funds. When lending in cryptocurrencies, it is important to choose your preferred platform wisely. This is because there is always a risk that borrowers will default. Also in this case Aqru stands out from the rest - the platform lends cryptocurrencies only to high-end borrowers who have been pre-verified.
7. "Faucets" Faucets - earn free cryptocurrency by completing simple tasks
Cryptocurrency Faucet websites give you the opportunity to earn free digital tokens by completing tasks. There are many platforms in this space, and the specific tasks you need to complete vary from site to site. For example, some crypto faucet platforms require you to fill out a captcha.
This is a task that anyone can do - so no prior experience is needed. There are also cryptocurrency taps in the form of a mobile app. They often require you to play newly launched games, and once you reach certain milestones you will earn free cryptocurrency.
However, keep in mind that the rewards offered on cryptocurrency tap platforms are small. In fact, in most cases, each task you complete will yield only a few cents of cryptocurrency. Nevertheless, you don't have to deposit any money, so cryptocurrency taps allow you to earn rewards in a risk-free manner.
8. airdrops - cryptocurrency tokens deposited into wallet for free
Similar to faucets, airdrops allow users to earn free cryptocurrency tokens without depositing or spending any money. The main concept is that some newly-launched projects distribute their native tokens directly to users' wallets as a way to put cryptocurrency into circulation.
This is the opposite of a conventional pre-sale and a fair launch directly on a cryptocurrency exchange. As such, the project does not raise any funds when it initiates an airdrop. While this may seem too good to be true, there are many examples of airdrops that have since become multi-billion dollar projects.
A perfect example of this is Bitcoin Cash. When this digital currency was launched in 2017, it dropped its BCH tokens to all wallet addresses that held Bitcoin. This was done on a 1:1 basis - meaning that for every 1 Bitcoin held, a user received 1 Bitcoin Cash.
In another example, popular cryptocurrency Stellar has shed millions of dollars in Lumens tokens since the project was launched in 2014. On the other hand, caution should be exercised when receiving dropped tokens. This is because fraudsters often create and distribute worthless tokens to random wallet addresses with the intent to "pump and dump."
9. DAO - buy participation in a decentralized autonomous organization
In addition to the metaverse and NFT, decentralized autonomous organizations (DAOs) are expected to play a significant role in the future of cryptocurrencies and blockchain technology. In their most basic form, DAOs refer to projects that are collectively owned by the community. In order to become a co-owner of a DAO, all you need is the corresponding token.
There are many DAOs running in this space, and each project is different from the others. One such example is Uniswap. The project is home to a decentralized exchange that allows people to buy, sell and trade digital currencies without the presence of a centralized third party. Uniswap has since launched its DAO cryptocurrency, making the project owned by token holders.
This means that any profits generated by the Uniswap exchange are then distributed proportionally to DAO token holders. What's more, DAO token holders have a say in how a particular project is run. This means that in order for a DAO project to decide on future development, it must first be voted on.
10. digging - mining cryptocurrency by connecting computer equipment
The last method to consider from our list of the best ways to make money with cryptocurrencies is mining. In a nutshell, mining refers to the process of connecting specialized equipment to a desktop device, which in turn connects to the blockchain of a given cryptocurrency. The idea is that miners enable the network to operate in a decentralized manner.
This is because transactions are approved when mining equipment solves complex mathematical equations. In return, miners are rewarded with newly minted cryptocurrency tokens that go into circulation, and each block is verified. In the case of Bitcoin, for example, a new block is created every 10 minutes, with an additional 6.25 BTC minted.
This 6.25 BTC - which as of today is worth more than $660,000 - is paid to the miner who successfully solves the equation for a given block. Although at first glance this translates into a significant sum of money, Bitcoin mining consumes an unprecedented amount of electricity due to the complex nature of each mathematical equation.
Moreover, the amount of specialized equipment required to have a chance to mine a new block of Bitcoin is also significant in dollar terms. Nevertheless, there are many other cryptocurrency projects that require miners, and in many cases there is little competition. Ultimately, you just have to make sure that the mining rewards you receive are worth more than the money you invest.
The best platforms for trading and investing in cryptocurrencies
Now that we've discussed the top 10 ways to make money with cryptocurrencies, we must now discuss the appropriate platforms to consider for this purpose.
To save you countless hours of searching, the best platforms for making money with cryptocurrencies are discussed in the sections below.
eToro - The best platform for trading cryptocurrencies
We briefly mentioned eToro earlier, and for good reason. Simply put, eToro is the best platform for investing and trading cryptocurrencies. Importantly, whether you want to invest in cryptocurrencies for many years or engage in a short-term daytrading strategy.
First of all, the platform is heavily regulated, so you can safely use the cryptocurrency markets. This includes approval from regulators in the US, UK, Cyprus and Australia. eToro offers nearly 60 leading cryptocurrencies to its more than 25 million registered users - so you can easily diversify.
Some of the most commonly traded cryptocurrencies on the eToro website are Bitcoin, Ethereum, XRP, Dogecoin, Shiba Inu, BNB and Cardano. In addition, we like the fact that the minimum transaction size is only $10 - you can try to make money on cryptocurrencies without having to risk large amounts of capital.
The minimum deposit is also $10, so it will be suitable for those of you who have a limited budget. We also mentioned earlier that eToro supports cryptocurrency staking. Unlike other platforms of this type, eToro does not require you to lock up your tokens for a minimum number of days or weeks. Instead, you can withdraw your tokens at any time.
eToro also allows you to make money from cryptocurrencies in a 100% passive way through two leading products. First, you can invest your money in a smart wallet that is managed by eToro. There are many wallets that focus on cryptocurrencies, and your basket of digital assets will be rebalanced and maintained on your behalf.
Secondly, if you like the idea of cryptocurrency day trading, but don't have the required time or knowledge, eToro allows you to copy the positions of an experienced trader by analogy. You can access the eToro platform online or through its leading cryptocurrency application. Either way, eToro allows customers to deposit funds for free using a debit/credit card, e-wallet or bank transfer.
Aqru - The best platform for cryptocurrency staking, earning interest and lending
If you like the sound of earning passive income, Aqru is generally the best platform for making money from cryptocurrencies for this purpose. As we mentioned earlier, Aqru is a trusted cryptocurrency lending site that offers some of the most competitive APYs in this space.
To reiterate, you will earn an APY of 7% on Bitcoin and Ethereum. If you're looking for even higher profits, Aqru offers an APY of 12% on stablecoins. This currently includes DAI, Tether and USD Coin. In addition to high yields, Aqru stands out in the market because all savings accounts are flexible.
This means you can request withdrawals of your cryptocurrency tokens whenever you want. We also like the fact that interest is credited to your account daily Aqru. You can then reinvest these payments back into your Aqru savings account to benefit from compound interest.
When it comes to starting your adventure with Aqru, you have the option to deposit cryptocurrencies directly into the platform. If you don't have any cryptocurrency on hand, you can also fund your account in US dollars, euros or British pounds. Supported payment methods include bank transfers and debit/credit cards.
Applications
In this guide about it, how to make money with cryptocurrencies, we discussed 10 proven methods to consider . Some of the best methods we've come across are cryptocurrency savings accounts, play-to-earn, yield farming, staking and the long-term investment strategy HODLing.
In conclusion, the best way to make money from cryptocurrencies is to invest in promising digital assets that are still at the very beginning of their journey.
In this way, you can often invest in the token of a particular project at a very favorable price. The best project for this purpose that we have identified is - which is revolutionizing the global cryptocurrency.
The views and opinions expressed here are solely those of the author and should not be taken as financial advice either. Every investment and transactional activity involves risk, so you are advised to do your own research when making any trading, investment or financial decisions.
