Cryptocurrency is a digital currency that uses cryptography to ensure security and control. No government or centralized authority controls these types of digital currency. Instead, a decentralized network of computers manages them.
The impact of cryptocurrency on the modern world has been extensive despite its short lifespan. It has enabled users to transfer money quickly and cheaply over long distances. Moreover, its new payment method allows consumers to purchase goods worldwide without worrying about exchange rates or other fees associated with international transactions.
Cryptocurrency has potential applications in many industries like banking, finance, accounting, and technology. As such, many are starting to realize its possibilities in establishing an income stream. Learn how you can do so and beat inflation with passive income below.
5 Ways to Earn Passive Income with Crypto
1. Cryptocurrency Staking
Crypto Staking is a process in which users store their virtual currency on a particular network and receive interest on their holdings in exchange. The interest you earn depends on the network or guidelines its developers set.
If you’ve accumulated enough cryptocurrency and don’t know what to do with it, staking may be your solution. This method is a passive way to earn money on your crypto holdings without selling them or trading them.
Staking is similar to mining, as it verifies transactions on the blockchain. The difference is that you won’t need expensive hardware and a lot of effort to develop this passive income stream. Instead, all you have to do is hold on to it while the blockchain keeps running.
Your virtual wallet will automatically verify transactions as they go through, and you’ll receive rewards every so often, paying you for minimal or no work.
2. Participate in airdrop events
New Initial Coin Offerings (ICO) are created daily. Due to this, non-crypto users can start using and accumulating cryptocurrency without taking any significant risks by participating in airdrops. Airdrops are a relatively new way to make passive income available to anyone with a cryptocurrency wallet.
An airdrop is when a company or organization distributes coins or tokens for free to individuals based on some criteria. In the case of crypto, an airdrop occurs from launching a blockchain with an initial supply of coins or tokens. This supply is then distributed to users accordingly.
This method often serves as a way to bootstrap a community around their new cryptocurrency. By giving away free coins, they can expose themselves to new users. So, if you want to get cryptocurrency for free, minus the pitfalls that come with it, look out for different airdrop events.
3. Capitalize on referral programs
Referral programs are a common way to grow a cryptocurrency’s user base. It’s also an easy way for you to make a passive crypto income.
If you’re unfamiliar with them, referral programs involve receiving a reward when you refer someone to the ICO or cryptocurrency. It’s great for businesses because it gives them an organic way to grow their user count. Moreover, there’s no hard cost involved, and it can produce results that aren’t achievable by other means.
4. Mining
You may want to consider mining if you’re willing to put in more effort for your passive crypto income. Crypto mining involves using your computer’s processing power—measured in hashes per second—to solve complex mathematical equations which verify transactions on the blockchain.
You are given virtual coins for your troubles in return for this service. These coins aren’t worth anything if they’re in your digital wallet. You’ll still need to put them in investments or sell the coins to generate profits.
Fortunately, you can still use mined currency as an investment vehicle, giving you passive cryptocurrency income when they appreciate.
5. Cryptocurrency Lending
One of the most popular ways to earn a passive crypto income is through lending. This method involved lending cryptocurrency to someone else in exchange for interest payments.
You don’t lose anything when you lend because there are no transaction fees. So instead of holding onto your Bitcoin or Ethereum, you can loan them out and earn interest.
The borrower receives money immediately and can use it however they want while they wait for their crypto to increase in value. If they default, the lender gets paid interest and can keep the cryptocurrency they’ve lent out.
The only way you as a lender can suffer a significant loss is if you accept any form of flat currency as collateral, so refrain from doing so.
6. Play Pay-to-Earn video games
Play-to-earn (P2E) crypto games are a new way to earn passive crypto income. This passive crypto income earner may be up your alley if you’re a gamer and cryptocurrency enthusiast. How it works is you play a game, collect points for your efforts, and trade those points for cryptocurrency.
P2E crypto games have been around for a while. But they’re only now gaining popularity as more people learn how to earn money without selling anything. Many deem cryptocurrency as the future of money, so these play-to-earn games will likely become even more popular as they become more mainstream.
The Caveat of Cryptocurrency
Virtual currencies have proven to be a revolutionary innovation. Ordinary citizens and even large corporations are capitalizing on what cryptocurrency can offer, especially regarding earning passive income.
Cryptocurrency may still be in its infancy stage. However, few can dismiss its impact on such a large scale. Hopefully, this blog post helps you as you aim to establish sizeable passive income using cryptocurrency.
