Top 10 Ways to Make Money on Crypto

Currently, the global crypto ownership rates are at about 4.2%, with almost 420 million crypto users across the globe. For comparison, the forex market, which is far older, more credible, and better established, has just ten million active participants. In other words, more and more people are making money on crypto. Here are the top ten ways you could join in on the action.

1. Buying and holding

The simplest form of investment is position trading. You find a cryptocurrency that you believe will grow in value. Then, you buy several tokens and sit on them for long enough. If you’ve accurately predicted a trend, its value will grow, and you can sell high. It’s just buying low and selling high, but with crypto.

Two things are key to making money this way. First, you need to recognize which trends will grow, which is far from easy, and it’s never guaranteed. Second, you need to avoid being greedy. Waiting for the peak is the easiest way to miss it and even encounter a reversal of the trend (completely missing your opportunity in the process).

2. Day trading

Day trading is dynamic trading that takes place within a single day. You’re exploiting small (daily) fluctuations in the value to make a profit. This is very volatile, risky, and potentially lucrative.

The most important thing for day trading crypto is to find the right platform. Here, you have many options, and you need to find the one that suits you the best. The No.1 thing that you’re looking for is their reputation. Then, you can focus on technical issues like minimum deposit, fees, etc.

Now, the past year’s events have cast a shadow of doubt over all major crypto exchanges. This is why Binance is taking steps to regain trust by improving transparency. Generally speaking, this is a factor you should consider, regardless of the exchange you choose.

3. ICOs

One of the easiest ways to profit from cryptocurrencies is to recognize the “next Bitcoin.” Imagine if you had an opportunity to buy Bitcoin while it was $1 per coin. With today’s knowledge, how many would you buy? Probably all of them.

The difference between ICOs and crypto presales is that the latter is offered to a few investors, while the latter is available to the general public. In other words, you just need to recognize the next big one.

While this is risky, no one is forcing you to buy too many ICOs at any given time. You can buy just a few and hope for massive, exponential growth. If the investment is small enough, the risk doesn’t really matter.

4. Yield farming

By yield farming, you’re using your cryptocurrency as collateral to provide liquidity to a decentralized exchange or a platform. You gain interest and fees, collect token rewards, and more. In a way, this is a great method of creating passive income using cryptocurrency. It is also quite similar to making money off masternodes (which is something we’ll discuss a bit later on).

Now, Technopedia names Yieldflow as one of the top crypto apps. As the very name suggests, it’s a platform that allows for yield farming. The fact that the platform is beginner-friendly also means that you’ll have an easier time getting into yield farming.

5. Arbitrage

The cost of cryptocurrency is sometimes different across different platforms. This means that, technically, you can buy a token on one exchange and sell it on the other while making a slight profit.

The key lies in being incredibly well-informed and present on these platforms. You must then identify opportunities and calculate the costs. The reason why this last part is tricky is that you need to consider fees.

Also, while you’re looking to make instant trades, the market is evolving with each passing minute. When you click the “sell” button next time, you may already be losing money instead of making it.

6. Mining

Early on, the main source of income from cryptocurrencies came from crypto mining, not trading. This meant you were “lending” some of your computing power to this decentralized financial network in exchange for a reward in its home currency.

While this is a great way to make crypto tokens, you need to understand that getting involved is expensive. First of all, mining rigs are not inexpensive, and when the value of crypto goes up, the cost of GPUs increases, as well. Moreover, your power bill will be gargantuan while mining. In other words, you’re making a sizable investment and exposing yourself to risk. Mining is nowhere near as profitable in 2023 as it once was.

7. Run masternodes

This is a very lucrative way to use cryptocurrencies to make passive income, but it requires significant collateral in crypto that the majority of people simply won’t have. To start, you must prove that you have a vested interest in the network’s operations. For this, you usually get a small reward in the network’s home currency.

The biggest challenge of running masternodes isn’t even in the collateral – it’s in the technical knowledge to pull it off. The best part is that if you already have enough collateral, you’re probably already knowledgeable enough on the subject matter. Even if you aren’t, finding someone to do it for you shouldn’t be too hard.

8. Lending

There are many P2P crypto lending platforms that you might want to consider checking out. If you have excess crypto, you could leverage your assets by lending them to those willing to borrow at interest.

You only need to find a reputable crypto-lending platform and learn about the subject. Then, pick a platform, deposit your cryptocurrency, and select your terms. The platform will filter potential borrowers and present you with a few borrower profiles. You pick who you want to borrow from based on the risk and the interest. The more you want to earn, the more you should risk.

As always, to protect your resources, you should diversify by borrowing to different lenders, potentially even on different platforms.

9. Blockchain development

If you understand the basics of blockchain and have some programming skills, you can make money as a blockchain developer. There’s more need than ever for blockchain developers; all you have to do is join an already open job market.

If you plan to join this field soon, you could plan your career path around it. You can look at programming languages like JavaScript, Rust, or Solidity. You must also understand blockchain’s basics and pick a blockchain platform. Sure, Ethereum is the biggest name in the field, but Binance Smart Chain and Polkadot are not to be taken for granted.

Remember that this field is quite competitive, and you must self-improve and attend conferences to stay ahead.

10. Crypto content creation

The field that’s so quickly expanding has a higher need for content. People interested in crypto need to learn about it, so why not create content that will educate crypto users and investors on the subject matter?

There is new news regarding crypto being published every day. Someone needs to make the coverage, which AI cannot do (especially since it may not have up-to-date knowledge).

With crypto regulation evolving at an astounding pace, more and more people in the crypto world are hitting that refresh button on every outlet, even mildly covering the topic. There’s an opportunity for you there somewhere waiting to be discovered.

Like with any other asset, there are many ways to make money from cryptocurrencies

When they say you’ve made money on crypto, people usually refer to buying and holding, day trading, or mining. However, as you can see, these are just some of how to make a profit on this digital asset. Remember that you’re not restricted to just one of these methods and that different people find different approaches convenient.