The cryptocurrency industry has grown substantially since the introduction of Bitcoin in 2008. For more than a decade now, buying and selling cryptocurrency has become a major digital way to make money.
Now that crypto has gained wide coverage and momentum across the globe with mainstream commercial and financial systems subscribing to it, you can use it to do a lot of things; which is to make payments, invest, and a whole lot more. It gives rise to wealth generation in dynamic ways.
Now, Let’s take a look at how to make money from buying and selling cryptocurrency.
Before that, let’s look at the definition of cryptocurrency.
What Is Cryptocurrency?
According to Wikipedia, cryptocurrency is a digital asset designed to work as a medium of exchange wherein individual coin ownership records are stored in a ledger existing in a form of a computerized database using strong cryptography to secure transaction records.
A known feature of cryptocurrencies is that they are decentralized. That is, they not issued by any central authority, rendering them immune to government interference or manipulation.
In recent times, cryptocurrency has proved to be a legit way of making money. And, that’s why you have to take this most seriously. The information below has the capacity to change your life.
Can A Beginner Make Money Buying and Selling Cryptocurrency?
Investing in crypto as a newbie can be all alluring. However, with the right information and mentorship, you will gain. Except you don’t follow instructions that’s when you’ll lose. Cryptocurrency is very volatile, and its volatility is something you should bear in mind. That’s why as a newbie, signing in for a crypto course or mentorship is a must.
You can win and lose a large amount of money quickly. This means crypto trading is exciting, and it can be very difficult to keep peace in mind under heavy pressure.
Cryptocurrency is a growing digital asset that effectively offers multiple means for anyone looking to make good money online. There are multiple ways in which you can make money with cryptocurrencies, some of which don’t even need you to invest anything but your time and efforts.
Given the intrinsic volatility of crypto assets, most options involve a high degree of risk while others require domain knowledge or expertise.
By the end of this article, you will know how to make money from buying and selling cryptocurrency.
How Can I Make Money From Buying And Selling Cryptocurrency?
There are different ways to make money with cryptocurrency. Given the inherent volatility of crypto assets, most involve a high degree of risk while others require domain knowledge or expertise.
Therefore, the basics should be familiar to you – you need to invest time or funds to make money. The fundamental ways to gain money using cryptocurrency are Investing (HODLING), Trading, and Earning.
Let’s look at the top 10 ways to make money from buying and selling cryptocurrencies.
1. Staking
Staking is the process of investing or locking up your funds in a crypto-coin and earning new cryptocurrencies in the form of interest. In addition, you also benefit from a price increase when you choose to hold your coins for a specific period.
In staking, you must be knowledgeable about yield farms. It is in this yield farm that you stake your coin adding to its liquidity. And you get paid handsomely for being a liquidity provider.
Many proof-of-stake cryptocurrencies will allow you to make a good income with staking. The best options include WISE, PIVX, Tezos, DASH, NAV Coin, etc.
For example, WISE is an ERC-20 token that allows you to earn a handsome income through interest by securing your funds in the WISE contract. With WISE you can earn up to 5% yearly interest on your stakes.
2. Buying & HODLing
This process allows you to buy some powerful cryptocurrencies with great ideas and then keep them for a while with the hope for their prices to go up. Once the coin price takes an upward move for you to make good profits, you can sell them in the market.
HODLing for long is one patient way to make good money in crypto. Let’s take for instance BNB, the price has multiplied x10 since January to date. Imagine you invested $20 in BNB in January. Right now, you will be having nothing less than $200.
The little advice here is that in HODLing, invest in stable coins. And one more thing, not all crypto wallets are good for HODLing coins.
3. Cryptocurrency Investment
Investing is one sure way to make money from buying and selling cryptocurrencies. Investing allows you to earn through exchanges, ICO (initial coin offering), or direct investment/partnership.
Crypto investment can earn you returns not only through an increase in the price of the coin/token you purchase but also through your share in the project. Depending on the type of cryptocurrency you invest in, you can get access to the project/product or can use the coin for payments.
4. Trading
The main difference between trading and investing is in the time horizon. While investing is a long-term endeavor, trading is meant to utilize short-term opportunities. Trading cryptocurrencies requires a special skill set and experience – most specifically, the ability to read charts and understand technical indicators.
This way of making money from crypto is more about understanding the price action in the historical context and using that to predict future prices, often on a short-term basis.
To make money online trading cryptocurrency, investors can either buy and sell actual crypto coins or use derivatives instead, such as a contract for difference (CFD).
So, here’s the deal, once you buy your choicest cryptocurrency, you can hold them for a while and wait for the price to rise before making sales.
Alternatively, there is also day-trading for those who wish to acquire enough profits by selling and buying cryptocurrencies on the same day.
5. Bonus Coins/Airdrops
Engaging in bonus/airdrop offers is an amazing way to earn with cryptocurrencies and it doesn’t even require you to invest in anything. To get running, all you need to do is join the airdrop or bounty program of a cryptocurrency and perform some easy tasks.
Additionally, you can earn bonus tokens by investing in a cryptocurrency during ICO or the token sale phase, as new projects often give bonus tokens to early investors.
Presently, the best airdrop that is projected to hit the market is the PI coin.
6. Mining
Mining is a vital component of the Proof of Work (PoW) consensus device and is one of the oldest ways of making money with crypto. It is a process of verifying transactions and securing a PoW network.
Miners get rewarded with new coins, through block rewards, for performing these functions. In the early days of Bitcoin, mining could be done on a desktop computer but today necessitates specialized mining hardware.
This method requires technical expertise and significant upfront and ongoing investment.
7. Referral
A crypto referral program is a known and really good way to earn cryptocurrencies. Most often, you’ll not even need to invest anything to refer and earn with a project. You can simply register on the website, get your unique referral link, and start referring and earning.
WISE and many other cryptocurrencies award you good profits for referrals. With WISE, both the referrer and referee get 10% bonus tokens for every successful staking through referral.
8. Sell for Cryptocurrencies
If you are a trader and cryptocurrencies like Bitcoin, Ethereum and Ripple are licensed in your region, you can accept the same in exchange for your goods and services. Cryptocurrencies are digital money and can be easily transacted and used globally without the need to convert into other currencies.
If you have a digital wallet, you can accept payment for your goods and services in cryptocurrency. Major businesses like Whole Foods, Nordstrom, Telsa, Subway, Microsoft, Amazon, and others accept crypto.
9. Dividends
Cryptocurrency dividends work like stock dividends. You invest in a dividend cryptocurrency and earn a fixed interest on every investment. All you need to do is buy and hold cryptocurrencies for the period you wish to earn interest.
The top dividend cryptocurrencies that you can invest in for interest are BNB, ETH, BTC, among others. Most of these coins don’t require you to stake to earn interest.
10. Work to Earn Cryptocurrencies
With the rise in the use of cryptocurrencies, many companies in the western world are now using these digital coins to pay their employees’ salaries, among other things. Crypto payments are secure, low-cost, and transparent.
Besides, it’s easy and affordable to pay your remote/freelance workers in bitcoin rather than sending cash through other options. Whether you’re a programmer, a writer, or a designer, you’ll find plenty of international companies ready to pay in cryptocurrencies for your work/services.
Conclusion
The main reason why cryptocurrencies are ideal for trading is because of the inconstancies. There are cases where you’ll have more profits due to the price when you bought the cryptocurrency, and you encountered an increase in the long run.
Also, the opportunity to buy cryptocurrencies when they’re cheaper or at the prices that are comfortable to you and sell off when you notice they’ve increased in value makes cryptocurrency a good source of income.
The golden rule in cryptocurrencies that don’t be. too greedy (this applies more to those in crypto trading daily).
Read Also:
Best 10 Cryptocurrency Wallets to HODL Coins in 2021
How Ethereum Broke $3,400 – what drives the Surge
Best 15 Cryptocurrency Trading Courses in 2021
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