11 Best Ways to Make Money with Cryptocurrency
Making money with cryptocurrencies is only possible if you consider the risks associated with these speculative assets. I have reviewed the pros and cons of 11 different methods:
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Long-term investing, active day trading: Choose, depending on your understanding of the market and risk appetite, to potentially maximize returns.
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Staking, yield farming: Utilize crypto platforms with interest rates to generate income from your cryptocurrency assets.
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Mining, copy-trading, affiliate programs: Diversify by choosing earning methods that match your skills and available resources.
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Airdrops, giveaways, faucets, ICOs, IDOs, presales, play-to-earn games: Participate in promo activities for a chance to earn cryptocurrency without an initial investment.
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NFTs: Explore staking and rentals for passive income.
In 2024, crypto has been put in the spotlight yet again due to the resurgence of the bull market. After a catastrophic 2022 and a mostly boring 2023, people are yet again shifting their attention to the crypto markets and looking for various ways that these can bring them profits.
While no method is infallible, various methods can be potentially lucrative, and all of them have their own advantages and disadvantages, and are more suitable for some and less for others. In this article, I’ll go over the 11 methods that my 6 years of experience in crypto markets have taught me are the real deal, and can yield significant profits if done right.
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How to make money using Bitcoin?
Mining, staking, and holding Bitcoin long-term (HODLing) are common strategies to make money. Each method requires different levels of knowledge, resources, and risk tolerance.
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Can I get rich with cryptocurrency?
Yes, it's possible to get rich with cryptocurrency, but it involves high risks. Success often requires thorough research, a well-thought-out strategy, and a tolerance for potentially volatile market swings.
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What is the easiest way to make money with crypto?
Airdrops, giveaways and faucets are the easiest way to make money with crypto, as they require 0 initial investment from you.
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How risky is crypto earn?
Crypto earning methods, like staking or yield farming, carry risks due to market volatility and the potential for smart contract vulnerabilities. It's important to research and understand the risks before participating.
Can you really make money from cryptocurrency?
In short - yes, you really can. Will you? That entirely depends on you, which method you choose, how suitable that method is to your preferences, how well you manage risk, how well you educate yourself, etc.
Here are some effective strategies:
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Mining: The process of using computer power to validate transactions on the blockchain and earning cryptocurrency as a reward. It requires technical knowledge and hardware investment.
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Long-term Investing (HODL): This involves buying and holding cryptocurrency with the belief in its long-term growth potential. It requires patience through market fluctuations.
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Active Day Trading (Including Scalping): This strategy involves making multiple trades within a day to profit from short-term market movements. Scalping is a subset of day trading that focuses on extremely short-term trades.
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Staking & Yield Farming: Staking involves holding coins in a cryptocurrency wallet to support the network operations, while yield farming uses crypto assets to earn returns through various DeFi platforms. Both are suited for those comfortable with risk and looking for passive income.
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Copy Trading: This allows investors to copy the trades of experienced and successful traders automatically. It’s a way to gain exposure to the crypto market without needing extensive personal experience.
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Affiliate Programs: Earning commissions by promoting cryptocurrency products or services. It's a way to make money by leveraging your network or audience.
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Airdrops, Giveaways, Faucets: Receiving free crypto through airdrops as part of promotional events, giveaways, or by using faucets which dispense small amounts of crypto.
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ICO, IDO, Presales: Investing in initial coin offerings, initial DEX offerings or presales offers the chance to buy into a new cryptocurrency project early, potentially leading to high returns as the project grows.
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Play to Earn: Participating in blockchain-based games that offer cryptocurrency rewards for playing and progressing within the game.
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Crypto Interest-bearing Platforms: Depositing cryptocurrency into platforms that offer interest on holdings, similar to a traditional savings account but potentially with higher rates.
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NFT Staking and Rentals: Earning rewards by staking non-fungible tokens (NFTs) or renting them out to other users for a fee. This can include digital art, collectibles, or in-game items.
Each of these methods presents unique opportunities and challenges. Keeping up with market trends, diversifying your portfolio, and being wary of scams are essential practices. Understanding the suitability and potential earnings of each strategy can provide a comprehensive perspective on the monetization potential of cryptocurrency.
Mining
One lucrative strategy often considered is mining, a complex process with its unique advantages and drawbacks, which demands consideration for those pondering if substantial profits are truly achievable.
Mining involves verifying transactions and adding them to the blockchain, thereby earning new coins as a reward. This method, however, requires substantial computational power and electricity, making it best suited for those with access to cheap energy and high-end hardware.
Personally speaking, I’ve never done the old-school mining with rigs and GPUs, as I’ve never had a space that could produce a good setup. However, I know some people who have, and it worked out well for them.
The potential earnings vary widely, influenced by factors like the mined cryptocurrency’s value, mining difficulty, and operational costs. Moreover, the market’s volatility introduces an element of risk.
If you want to mine with software, read Тоp 10 best mining software in 2024 | TU review.
Long-term investing (HODL)
Shifting gears to long-term cryptocurrency investing, often referred to as HODLing, this strategy presents an alternative avenue for individuals looking to potentially profit from the digital currency market. I like long-term investing myself. The key pros of this approach include lower stress levels compared to day trading and the potential for substantial returns if the invested cryptocurrency appreciates over time.
However, the risk of price volatility and potential loss cannot be ignored. This strategy suits patient investors who can withstand periods of market fluctuation without panic selling. The earning potential varies widely, depending on the initial investment and market performance.
While some HODLers have indeed made fortunes, it’s essential to remember that cryptocurrency investments are speculative and should represent only a portion of a diverse portfolio.
The reason I find this method works for me is because it’s the most reliable way to take advantage of the bull-bear market swings. I realized about 75% of my crypto profits by simply investing in a bear market, being patient and waiting for a few years, and then selling in the bull market.
For cheapest crypto exchanges, read Best cryptocurrency exchanges for Low Cost Trading.
Active day trading (including scalping)
In stark contrast to the HODLing strategy, active day trading, including scalping, is a dynamic and immediate method of generating profit from cryptocurrency, although it’s not without its unique set of risks and rewards.
Day trading involves buying and selling assets within a single trading day, often exploiting short-term price fluctuations. Scalping, a subtype of day trading, seeks to profit from very short-term trades, often lasting just minutes.
| Pros | Cons |
|---|---|
Potential for quick profits |
Requires constant monitoring |
Exploits volatile market |
High stress levels |
Numerous opportunities daily |
High risk of losses |
Scalping can yield small, consistent profits |
Requires deep understanding of market |
No overnight risk |
Statistically, most traders lose more than they win |
This method is best for those with a high risk-tolerance, ample time, and a deep understanding of the market. Earnings can vary greatly, but skilled traders can make substantial profits.
The problem I find with day trading, and the reason I don’t day trade crypto myself is - trading is a zero sum game. In order for a person to win, another person has to lose. And if you are trading, you are competing against professional traders who have been trading for 20 years. It’s possible you may be able to beat them, but I’d personally rather not play that game altogether.
If you are interested in day trading, I advise you to read Best Strategies to Day Trade.
Staking & yield farming
As an alternative to active trading, cryptocurrency enthusiasts often turn to strategies such as staking and yield farming, which offer their own unique blend of risks and potential rewards.
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Staking involves holding a cryptocurrency in a digital wallet to support the network operations. It’s best for those who can tolerate medium risk and have a longer investment horizon. Staking often requires you to “lock up” your holdings for a predetermined amount of time, e.g. 6 months, or a year. As a reward for staking, once the period ends, you get back all the assets you staked plus a bit extra.
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Yield farming, on the other hand, refers to putting your cryptocurrency into a DEX (decentralized exchange) pool to earn interest. That interest is usually comprised of a combination of:
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Percentage of the trading fees
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Inherent reward that a DEX gives out since you are supporting the DEX by providing liquidity, thereby allowing people to trade on it
Yield farming is suited for more risk-tolerant investors seeking high returns, while still retaining a good bit of passivity. Earnings vary based on coin value and network conditions. These strategies require substantial capital and technical knowledge (especially true for yield farming), and the risk of loss can be high due to market volatility and potential scams.
My advice is - if you’re a beginner, stay away from yield farming, and only stake if you are absolutely certain you know how to do it, and you have absolute trust in the platform you’re using. Don’t let that extra 10% a year in interest make you lose it all because something went wrong.
If you’re wondering what to stake, read Best coins to stake in 2024.
Copy Trading
Copy trading involves mimicking the trading decisions of experienced traders, potentially offering a way for novices to earn from cryptocurrency without extensive market knowledge. While this method reduces the learning curve, it also exposes investors to risks if the copied trader makes poor decisions.
Here’s a brief overview:
| Pros | Cons | Best For |
|---|---|---|
Reduces learning curve |
Reliant on another’s decisions |
Novices |
Potential for high returns |
Risk of poor decisions |
Risk-tolerant investors |
Access to experienced strategies |
Potential for loss |
People with less time for market analysis |
Earnings vary widely, depending on the success of the copied trader. This strategy, though not without risk, can be a viable way for new investors to navigate the often complex world of cryptocurrency trading.
To learn the best platforms for copy trading, read 8 Best Copy Trading Platforms - Copy Trade Software for 2024
Affiliate Programs
Turning our attention to affiliate programs, these can offer a profitable avenue for individuals interested in monetizing their influence within the cryptocurrency sphere. These schemes involve promoting a cryptocurrency product or service and earning a commission from the sales made through your referral link.
| Pros | Cons | Who It’s Best For | Earning Potential |
|---|---|---|---|
Affiliate programs can provide a steady income stream if you have a substantial audience interested in cryptocurrency. They require minimal investment with potentially high returns. |
Your earnings depend on successful conversions from your referrals, making it unpredictable. |
Influencers, bloggers, or anyone with a significant online reach in the crypto sectors. |
Earnings vary greatly but can range from a few hundred to thousands of dollars monthly, depending on your influence and the program’s commission structure. |
This method isn’t available only in crypto or finance, affiliating works similar for whatever product or service you happen to be affiliate marketing for, in this case, it just happens to be a crypto project.
Airdrops, Giveaways, Faucets
Airdrops, giveaways, and faucets present unique avenues for income generation, each with their respective benefits and drawbacks.
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Airdrops, which are essentially free tokens distributed by crypto companies, are a great way to earn without investment. The unpredictability of coin value can be a downside.
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Giveaways, often held by influencers or companies, offer chances to win substantial rewards. The caveat is that they are often based on luck, such as lotteries.
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Faucets, websites that give minute amounts of crypto for completing tasks, are consistent but time-consuming. These methods are best for those willing to invest time but not money, with patience for potential growth. Earnings vary widely, contingent on the crypto’s market performance.
Generally for all these methods, there will be some tasks you need to complete in order to qualify. Qualifying for airdrops and/or giveaways can usually require you to, for example, follow the project on social media, join their Discord, invite more people etc.
Find out the best faucets in our list Top 7 Bitcoin Faucets to Earn Money Without Investments.
ICO, IDO, Presales
Initial Coin Offerings (ICOs), Initial DEX Offerings (IDOs), and presales all essentially give an opportunity to purchase a coin before it becomes available on the public markets, and to do so at a cheaper price.
| Pros | Cons | Best For | Earnings |
|---|---|---|---|
These methods give investors early access to new projects at potentially significantly lower prices, offering high returns if the project succeeds. |
They carry significant risk, as initial offerings may be scams, and even legitimate projects can fail. |
Experienced investors who can carefully research and understand the potential of a project. |
Profits can vary widely, from losing the entire investment to potentially multiplying the initial amount. However, these outcomes are not guaranteed and require thorough due diligence. |
This is definitely not a beginner-friendly method, as participating in any of these typically requires:
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Experience with crypto markets
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A good amount of capital, since there’s usually a minimum amount requirement for participating
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Effort and time, since you need to actively seek out ICOs, IDOs and presales yourself and find the right ones
Play to earn
With the advent of blockchain technology, “play to earn” models have emerged as a novel approach in the cryptocurrency space, offering users an opportunity to generate income by participating in digital games. Pros include earning cryptocurrencies simply by enjoying games, fostering a potentially profitable hobby.
However, cons like the risk of game discontinuation and possible market volatility should be considered. This model is best for gamers with a knack for strategy and a passion for keeping up with crypto trends. In the last bull run, many people around the world left their jobs to play Axie Infinity, which was yielding between $300 and $700 a month on average for playing only 2 or 3 hours a day.
Axie Infinity Homepage
Still, that only lasted for a couple of months, and eventually the underlying token became virtually worthless. My thesis is that we will once again have a game in this bull market that reaches these levels, maybe a few of them, but my recommendation is to view it as supplemental income rather than a primary revenue source.
Crypto interest-bearing platforms
Platforms that offer interest for keeping assets there can be a worthwhile endeavor. Unfortunately, it’s not quite as clear-cut as it may sound.
| Pros | Cons | Who It’s Best For | Earnings |
|---|---|---|---|
These platforms offer significantly higher interest rates compared to traditional banks, opening a new stream of passive income. |
The volatile nature of cryptocurrencies brings about a risk of capital loss, and these platforms can also fail, either due to hacking or bad business models. |
Crypto interest-bearing platforms are ideal for investors who want passive income and have a good understanding of the crypto market and the ability to differentiate between trustworthy platforms and others. |
The earnings vary based on the invested amount, chosen cryptocurrency, and the platform’s interest rate, but can be substantial over time. |
Furthermore, a bulk of these platforms tends to be centralized, which is the opposite of what crypto is fundamentally about. We all remember what happened to Celsius, a crypto interest platform that went up in flames with most of their users losing their assets.
NFT staking and renting
The intriguing concept of NFT staking and rentals is a novel venture that only really became a thing in the last few years.
| Pros | Cons | Ideal For | Earnings |
|---|---|---|---|
NFT staking and rentals can provide passive income, especially if the NFTs appreciate in value. |
The NFT market is volatile and unpredictable, potentially leading to losses. |
This method suits those willing to speculate and bear the risk associated with NFTs. |
The earning potential varies greatly, depending on the NFT’s popularity and demand. |
This is obviously an extremely risky method. NFTs are highly volatile, even more so than the average crypto assets, which are already very volatile themselves. This should never be something you solely rely on to make money, and should be seen as more akin to gambling rather than investing.
Best crypto exchanges
Tips on making money with cryptocurrency
Understanding effective strategies can significantly increase your potential for financial gain.
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Stay Informed: The cryptocurrency market is notoriously volatile. Keeping up-to-date with market trends, news, and emerging technologies can give you the necessary edge. Regularly follow reputable news sources and consider joining online forums or social media groups focused on cryptocurrency discussions.
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Diversify Your Portfolio: Putting all your money into a single cryptocurrency increases your risk. Spread your investments across different assets to balance potential losses with gains. Diversification can include different types of cryptocurrencies, tokens, and even blockchain-based assets like NFTs.
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Consider Long-term Holding: Despite short-term fluctuations, many cryptocurrencies have shown a pattern of steady growth over the long term. Holding onto your investments, a strategy often referred to as "HODLing," can potentially lead to considerable returns.
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Avoid Scams and Frauds: The crypto market, due to its relative anonymity and lack of regulation, attracts scammers. Conduct thorough research before investing, use reputable exchanges and wallets, and be cautious of offers that seem too good to be true.
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Don’t let your emotions get the better of you: If you only listen to one tip, let it be this one. Of all people who lose money in crypto, 90% of them lose because either their greed or their fear got the better of them. Stay humble, stay patient, and if you feel yourself getting ramped up by something, afraid you’ll miss out, or fearing you’ll lose money if you don’t do something immediately - just walk away. Walk away, take a day to collect your thoughts and approach the situation again with a calmer perspective.
Summary
Making money with cryptocurrency hinges on staying informed about market trends, diversifying one’s portfolio, considering long-term holding, and vigilantly avoiding scams and fraudulent schemes. The realm of cryptocurrency offers vast opportunities, but it demands strategic planning and careful decision-making.
Don’t get greedy, know your limitations, don’t try to do all methods at once. Instead, choose 1 - 3 that align with your preferences, and focus on learning the ins and outs of them. It’s better to be great at 2 methods of making money, than to be average at all 11, since, remember, average people lose money.
Team that worked on the article
Vuk stands at the forefront of financial journalism, blending over six years of crypto investing experience with profound insights gained from navigating two bull/bear cycles. A dedicated content writer, Vuk has contributed to a myriad of publications and projects. His journey from an English language graduate to a sought-after voice in finance reflects his passion for demystifying complex financial concepts, making him a helpful guide for both newcomers and seasoned investors.
Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.
Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).