No matter how much capital you have on your hands, there is always a way to make money with one of the many cryptocurrencies of this world. In this post, we will give you a brief overview of 4 strategies you can start using today.
Disclaimer: since cryptocurrencies are volatile in nature, do not proceed without doing your own research beforehand and only invest what you can potentially afford to lose.
With that out of the way, here is method #1:
1. Crypto lending
Are you sitting on a pile of crypto coins you won’t be in a dire need of any time soon? Then consider putting them to work by lending them to others while generating hefty returns in the process. Thanks to sites like smartcredit.io, lenders and borrowers have an easy way of finding each other and establishing mutually-beneficial business relationships. While long-term loans are typically associated with higher interest rates, it’s up to you to determine the exact terms and conditions of the deal. Since the emphasis lies on predictability, both parties involved are always in the clear in terms of what they can expect, making lending one of the most stable ways to generate an income with crypto.
Do you live in an area where electricity is cheap and you don’t mind forking over some money to purchase a mining rig? Then cryptocurrency mining can be a great option to consider. Most modern-day crypto miners tend to join a mining pool, which is a fancy way of saying ‘group effort’. In other words, when one of the machines in the pool gets it right and unlocks a coin, all of the miners will get an equal piece of it (the exact amount is modified by that machine’s hardware capabilities for obvious reasons). Keep in mind there are other cryptocurrencies you can mine besides Bitcoin, which may or may not be worthwhile depending on your specific circumstances.
If you can stomach the noise, crypto mining can be a lucrative endeavor.
3. Traditional investing
Traditional investors purchase cryptocurrencies and hold them over a prolonged period of time, expecting an increase in value. Given how most cryptocurrencies have gone up in the last couple of years, this is a solid strategy. Unlike day trading (which we’ll be covering in a minute), the effect of variance is much lesser in comparison. The consensus is that big-name crypto coins like Bitcoin and Ethereum make for a much safer investment compared to the lesser-known alt coins. A good rule of thumb is to never keep your eggs in one basket and spread out your investments to keep the risk to a minimum.
4. Day trading
Day trading is a short-term investment strategy where you place your bets on what cryptocurrencies will go up or down. Compared to long-term investing, it can be quite a tough game to master, often requiring an advanced understanding of technical analysis and a firm grasp of the market nuances. While there’s no need to get everything right all of the time, you do need to be right the majority of the time to make a profit. Although day trading seems like the least preferential path to take, one of its major strengths is that it does allow you to make money regardless of whether the market is bearish or bullish.
The growing acceptance and utility of cryptocurrencies is creating interesting opportunities for everyone. The right one for you mostly depends on your risk tolerance and starting capital.