At this point, it’s not a mystery what cryptocurrencies are. At the very least, you know what Bitcoin is. Everywhere you go, people are just talking about Bitcoin and how they could have been a millionaire. In reality, not too many people have hit the jackpot with this new technology but there are many ways to make money in this industry. They range from mining to the basics of day trading cryptos.
Mining is the process that a lot of cryptocurrencies go through. It is the process of computer equipment’s or specific hardware goes through in order to add and confirm payments through the blockchain, which is the public ledger. The process of mining is done for two main reasons. The first one is to confirm and add each transaction to the blockchain. This helps there not be double spending of coins too. The next reason is that you accumulate more coins by mining. This happens when using brute force with a special program to unlock coins. So you are not only making money by unlocking coins but by transfer fees that one party is spending for their coins to reach another party.
Staking is the opposite of what mining is. It involves keeping your cryptocurrencies inside your wallet. This helps protect the security of the coin or token. You get a specific percentage sent back to your coins. For example, Neblio gives 10% back to you of the number of coins you have back. So if you have 20,000 total tokens, you will get 2,000 back every year. It is usually paid out weekly. Coins that can be mined usually cannot be staked but some coins can do both. Staking is the passive income for cryptocurrencies.
Community farming is where a big company buys all the hardware to mine and set everything up. They even pay for all expenses like electricity and air conditioning. All you do is invest in the company. Depending on your investment, you get a specific return. For example, MGT Capital which is owned by John McAfee does exactly this. He has mining machines in different locations and you just invest in his corporation.
Lending with cryptocurrencies can be a bit sketchy. The reason we say this is because the biggest lending service in this industry, BitConnect has been noted to be a Ponzi scheme that is yet to fall. Other ones have recently come out like SALT which many people are raving about. However, the option to try them out is there.
This is the hardest and the riskiest one yet but it is the most rewarding if you can pull it off. It seems easy, even in a bull market like we have now but there are things to remember while trading cryptos. You have to remember that there is a huge volatility that occurs daily. One day you can be up and the next day you’re down more than what you started out with. It is very risky and not easy. Another thing to remember is to have a specific number in mind. Get in at a specific price and know the specific price you want to exit with. Don’t be greedy because it will bite you in the back.
Equity is probably the best one and easiest one and ironically, one of the most rewarding one out of all of them listed. In a bull market, everyone is a genius and your reward will be at the maximum when you hold your investment longer. It is still a good idea to have a price in mind to exit at. You do not want to get greedy when it comes to investments. Holding is a great strategy if you can must the patience. As Warren Buffet says, “The stock market is a device for transferring money from the impatient to the patient.” The same can be true for cryptocurrencies.
This is not for everyone but being able to accept Bitcoin is a big one. If you own a business or do services for people, tell them to pay in Bitcoin. You can even give them a discount for paying with Bitcoins if you believe the value will go up. It can pay off in the long term.
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