How to make money with cryptocurrency
Cryptocurrency brings a lot of opportunities. All of us heard how much other people could earn via trading or mining this asset.
Most lucky stories were real luck. Some years back, it was really easy to create a huge equity using Bitcoin or other cryptocurrencies. Now, you need to have experience and certain knowledge if you want to earn money using this method.
There are a lot of different ways to get money with cryptocurrency. Today, you are going to learn the best and safest of them.
Can beginner earn money with cryptocurrency?
Unfortunately, no. When there was a very big demand, you had a chance to increase equity. Now, cryptocurrency is simply a very volatile asset.
There are a lot of things that can decrease any chances of getting money.
- You need a lot of time and effort to become a professional. You need to study technical analysis, economics and other elements. Also, you need to have a lot of money because your first attempts will be unlucky.
- Lack of a trading strategy. It is necessary to understand what actions you make and what results you expect. All traders can wait for an appropriate moment.
- Your hope to recover the money invested. Unfortunately, it is impossible without understanding your strategy. A lot of people create an order with excitement, but emotions are the main reason why beginners fail. Also, beginners hope that the price will sooner or later be as good as previously. Yet, the fact is that Bitcoin cost 21 thousand earlier doesn’t say that this price will return.
- You don’t like or forget about risk management. Due to high cryptocurrency volatility, this is the first thing that you must do. You need to understand what level of risk is suitable for you and trade after that. Make a take-profit and stop-loss orders. Also, you must protect yourself from the risks not associated with trading, such as scammers or regulatory risks. Remember about the rule: don’t invest the amount of money that you are afraid to lose.
The main reason why some traders will stay beginners even if they spend a lot of time on this is the inability to learn from their own mistakes. For example, they can continue to invest in a coin that no longer has good prospects.
Methods to earn money on cryptocurrency
There are 10 methods to increase an income with cryptocurrency.
This method to earn money with cryptocurrency is the easiest. You only need to buy some coins and wait until they increase in price.
You need to have a very detailed strategy because you should understand how the price of this cryptocurrency changes. For example, you buy a coin which seems to be very promising. Later, the price falls and this token completely loses its value.
Advantages of this method:
- Easy to start.
- Accessible for beginners.
- Long-term predictions are significantly easier.
If you are a beginner, you’d better use this method of making money with cryptocurrency. However, you should understand – it can take a lot of time. If you want fast results, this method isn’t for you. Yet, if you are a beginner, this method is the safest.
You can trade crypto CFDs on Forex. CFD is a financial instrument where you trade not the real asset but the price for it. There are a lot of advantages and disadvantages that this method has.
- You need a small amount of money to start trading.
You can use leverage to increase the amount of money that is invested.
- You can make any orders without limits.
- You can trade from any point of world using a smartphone or PC.
- Leverage can multiply your money by zero. With increase money at your disposal, risks also grow. That’s why leverage isn’t recommended for beginners. Even the smallest move can eat up your deposit.
- This method isn’t suitable for long-term trading.
Almost all Forex brokers allow you to trade on a demo account. It is very convenient for beginners who don’t have a lot of money and skills, but want to study trading.
If you are interested in a fast cryptocurrency income, you can try intraday trading. This is a strategy that implies multiple orders during the day. Intraday trading is very suitable for any cryptocurrency because of high volatility. All cryptocurrencies grow and fall many times a day, and you have a great chance to get a fantastic income.
The main advantage of this approach is its low price. But there are enough negative sides:
- It is a very hard strategy for beginners because you need more skills.
- It takes a lot of time. Actually, this is a full-time job that can take five and more hours.
- Bigger fees.
This is a classic, but difficult method. It can bring a great income if you do it successfully. You need a lot of electricity, software, special hardware to get a lot of money. This is not suitable for all people because of the poor financial situation of most users.
In the first years of mining, people could earn money very fast. However, in 2020, this process is very hard because you need more and more powerful equipment that is very expensive and consumes a lot of electricity.
Today, the best method to mine Bitcoin, Ethereum or other cryptocurrencies is to join a pool where you get a percentage of income respective to your hashrate. The higher this index is, the bigger payouts you can get.
Mining is the full business and isn’t appropriate for every person.
Advantages of this method:
- You can earn a lot if you invest a lot.
- Too expensive
- Too difficult.
Some investors like to use arbitrage to get money with cryptocurrency. The core of this method is in buying coin on one exchange and selling on another, where this token costs more. This is the easiest method for beginners.
Positive sides are the following:
- You can get an income immediately.
- You need a little money to trade.
However, disadvantages also exist:
- Great opportunities are rare.
- Due to high volatility, you can lose money.
Crypto crane is a great method to get a small amount of cryptocurrency. This is a website (or an app) where you can get a small quantity of coins for completing some tasks on this website.
- It is easy to use.
- You can get cryptocurrency for free, without any difficult actions. This is the best method for lazy people.
- You can’t earn a lot.
- You need to spend a lot of time on the website to get money.
ICO is a type of investment project that is similar to crowdfunding, but it is from another sphere. People can invest their money in ICO to get a profit. Some investments are great, some are unlucky. You should invest only in those projects that are detailed and reliable.
ICO projects can be created by scammers. This is the main risk.
- Possibility to invest in promising companies
- Requires little money
- No commissions and fees.
- A lot of scammers
- No protection from hackers
- High volatility.
This method is very popular. You play a game and get some tokens. Developers hope to engage new gamers this way. You only need to have a mobile phone or tablet and get cryptocurrency along with a lot of positive emotions.
- It is easy.
- You need to have a lot of time.
Be a blockchain developer
This is a very hard profession. You need to have a special education to become a developer. You should understand that your program can be changed by any person. If you everything the right way, you can get money from advertising, purchases, subscribes and other sources.
- You get a large income.
- This method is safe.
- You have to have a special education or at least self-acquired knowledge.
To sum up, you can earn Bitcoin, Ethereum or other cryptocurrency in different ways. You can choose any you want.