Cryptocurrencies have made it possible to make passive income via several strategies even though it is very risky.
With the price volatility and bankruptcy of some crypto exchanges and platforms like FTX, Coinlist, and so on, crypto remains the riskiest form of investment. However, it is still a means of making money today if you have the technical know-how and can take risks.
In this post, we’ll look at the top passive income strategies in crypto. Before then, let’s understand what passive income is all about.
What is Passive Income?
Passive income is a means of earning money steadily with little effort. While many people want to be wealthy, earning passive income is top on the list of things to do. Many have described passive income as making money while you sleep. Although you need to do one or two things to make this possible; you’ll need to have money to create passive income for yourself.
Passive income can come in two ways; you can earn passive income by creating and investing. In creation, you could sell digital products, create music, write books, or make other products that earn cash. It can be earned via investment in real estate, dividend stocks, cryptocurrency, and so on.
Crypto as a Means of Earning Passive Income
Cryptocurrencies are a means of making quick money today. There are a lot of people who have made a fortune via crypto which can be through many of its endeavors.
Crypto assets such as Bitcoins, Ethereum, Solana, Dogecoin, and as well as NFTs can be used to earn passive income. Although earning passive income through digital assets such as crypto is for the averse risk takers.If you must make crypto a means of earning passive income, you should put what you can afford to lose.
Best Strategies to Earn Passive Income in Crypto
1. Earn By Participating in Crypto Lending
Some crypto coins give you a lot of benefits when you own them on exchanges. Holding some crypto assets makes you involved in its governance. However, earning with it when it is stored is quite top of it.
Through decentralized finance (DeFi) platforms, you could earn by participating directly in a crypto lending process. The crypto you have purchased on an exchange can be loaned out to a pool. This is used to lend to others for interest and fees. With this, you earn a passive income just for committing your coins/tokens to the course.
The amount you earned from this depends on the duration of the loan, the amount of your token given out to the pool, and the internet rate attached to it.
2. Earn Through Crypto Staking
Different from mining which is quite expensive and energy consuming is staking. Mining (proof-of-work)is no doubt a means of earning passive income in crypto but staking (proof-of-stake) is far better.
Staking allows you to earn when you hold your coins/tokens in a wallet for some time. Here, validators work instead of miners as seen in the PoW consensus mechanism.
You don’t need to solve mathematical puzzles using powerful computers in this case. Some exchanges allow you to stake automatically with your crypto coins. You can also hold the coins in a cryptocurrency wallet (software or hardware) to earn passive income via staking rewards.
Ethereum which has permanently moved from the PoW to the PoS consensus mechanism is one of the best cryptos to stake. Other top crypto assets to stake are Solana (SOL) and Cardano (ADA).
3. Play-to-Earn Gaming
What is as easy as playing online games and earning while doing so? Well, I’ll leave you to answer that.
Play-to-earn gaming has been one of the raves of the moment alongside selling NFTs in the crypto space. There are many crypto games available for you to earn. Axie Infinity, Sandbox, and Decentraland are top on the list.
Earning passive income via this strategy is popular in countries like the Philippines for those who are out of jobs or want additional income.
The Metaverse is one element of crypto that is developing in this regard. It is quite an awesome strategy to earn in crypto today.
Conclusion
Cryptocurrency is a means of earning passive income in the world today. Although crypto and its endeavors can be very risky, there are strategies that can be employed to minimize loss and make profits.
