Earning passive income in the cryptocurrency industry is relatively straightforward, although results may vary. One can opt for traditional methods or more active solutions, such as staking. There are many benefits to this approach, and the opportunities at one's disposal become more outspoken over time.
Making Passive Income in Cryptocurrency
The easiest way to earn a passive income with cryptocurrency is by buying assets and waiting until they appreciate in value. Some markets will have an easier time doing so compared to others, but that is only normal. The yearly performance of Bitcoin and Ethereum is often far better compared to those of altcoins and tokens. Bitcoin and Ethereum "dictate the pace" for all other markets.
By buying either BTC or ETH and holding on to it for a more extended period, one can often see its value appreciate. That value appreciation is the most passive way of earning income with cryptocurrencies. It does not require any action on behalf of the user, but it may require a different mindset. These assets are volatile in nature, meaning their prices can go up or down at any moment. It can be a rollercoaster ride, but the overall performance of these assets will often help net a passive income in time.
Other options to earn passive income with cryptocurrency revolve around lending and borrowing. These options have been available for years. One can either use an exchange to lend crypto holdings to margin traders or use one of the many platforms in decentralized finance. Having the ability to extend a loan to anyone else and earn interest for doing so is as passive as income can get. It is not without risks, however, but no financial activity is in this day and age.
Staking And Other Options
For those who prefer a slightly more "active" approach to passive income, cryptocurrency staking can be worthwhile. The concept is simple" keep your funds in a wallet connected to the internet to receive rewards. Hundreds of crypto assets support the staking approach and reward users for doing so. One of the bigger currencies to introduce staking lately is Cardano, albeit Ethereum will transition to it in the coming year.
Per Stakingrewards, users can earn a decent passive income per annum. An industry average of 14.95% return per year is a far better option than keeping money in a bank account. However, one has to remember the assets earned are volatile cryptocurrencies. Their fiat currency value may fluctuate wildly, affecting the potential returns on investments.
A different approach is provided by Aloha, a project paying users for sharing their mobile bandwidth with others. Users can spend all rewards on offers and services through the native merchant marketplace. Bandwidth sharing is a powerful and popular concept and can be successful with the right incentives. Aloha has also introduced a few DeFi solutions to let users earn in multiple ways.
Closing Thoughts
There are numerous ways to make passive income with cryptocurrency. Some approaches require a bit more work, but they will keep generating money once they are set up. Depending on one's risk appetite, exploring DeFi or staking can prove worthwhile. It is easier to track rewards through those methods, although seeking price appreciation through exposure to Bitcoin or other assets is equally viable.
For those feeling a bit more adventurous, exploring unique cryptocurrency ecosystems that offer rewards in exchange for services can be viable. Moreover, it doesn't require much setup or maintenance, making it a suitable passive income stream. The cryptocurrency industry has many ways of helping users generate passive income, depending on their preferences and expectations.
