Lots of people know about cryptocurrency and they have heard about how people make insane amounts of money from it but cannot really understand how that works and in a bid to not miss out, they FOMO into a crypto/token that has all the rave at that moment and they end up becoming the 99% who lose money and they cry foul.
Before we proceed, let’s first of all talk about what cryptocurrency is.
Cryptocurrency can be likened to a kind of digital money that only exists in your computer. You cannot touch it or hold it or take it to your bank. It operates on decentralized networks called Blockchain technology and it needs no Central Bank control or traditional policies to make.
What is FOMO by the way? FOMO is a word that the crypto world coined out during the early days of cryptocurrency when many with no idea of what token-economics meant jumped into certain investments because people were shilling the coin only to get burnt badly.
FOMO = Fear Of Missing Out.
I am sure you may have felt the pressure to FOMO into some tokens that your friends or your fave influencer was shilling and then you end up getting burnt. And then, you start asking lots of questions like:-
❖Why do people lose money in crypto investments if it is said to be the future of money?
❖Why is it that, everytime I invest in a token is when it goes down or gets
completely taken out of the market?
This write up is about what makes money in crypto and how you too can start making money too. So, I want you to follow closely so you can get the best out of it and possibly start making good Crypto investments.
There are various ways of making money in Cryptocurrency investment. The list is in no particular order and do make sure to do your own research before taking a plunge in any of these you choose to get into. It is important to note that the market is highly volatile and speculative. What works for Mr. Q may not work for Mr. M, so take note.
Participating in Airdrops:
Some projects distribute and give free tokens to existing cryptocurrency holders through airdrops. This is the easiest and almost risk free way to make money in cryptocurrency. A lot of individuals have made good sums of money from airdrops just by holding certain tokens over a period of time.
You may qualify for a project’s airdrop through one or all of the following below.
● By holding certain tokens.
● By participating in surveys and contests.
● By completing tasks on selected websites. These may include following certain handles on social media sites, referral campaigns etc.
Saving it for later (HODLing): This is the process of saving your candies or cash for later. Some people buy this magical computer money called Cryptocurrency and keep it, with hopes that its value will go up over time.
An example of this is the people that bought Bitcoin in 2011/2012 when it was around $100 and held it for more than 7 years and when they sold, they sold for $40,000.00 per coin.
Staking:
Staking can simply be defined as a way of helping the computer system to grow by lending that magical money you have in return for some rewards. It is like saving your money in your traditional bank and you get paid some interest after sometime.
Staking can be done in a proof-of-stake model (PoS) or delegated proof-of-stake (DPoS) consensus mechanisms.
Trading:
Users can make money through the process of selling their tokens on the spot market to make some money through the difference in price. This is also known as Arbitraging. Buying low and selling high to make a profit from the difference in the buying and selling prices. This process is done on cryptocurrency exchanges.
An example of how you can make money through trading cryptocurrency is when you buy a token for $0.003 and after a while, (usually during a trading circle that can be a day or hours) you sell said token for $0.009 or higher and you make a profit of $0.006.
You make more when you repeat this process over and over again. To start trading cryptocurrencies, you can head to the Roqqu App now www.roqqu.com
NFTs (Non-Fungible Tokens):
Holding, buying and selling and lending of NFTs is another way individuals make money through Cryptocurrency.
NFTs represent unique digital assets and are in various forms like art, gaming, and other digital content that represents our day to day innovations.
An example of this is the Bored Ape NFT collections that sold for $190 when it was launched in April 2021 and later sold for as much as $1.2m
Token Sales and Initial Coin Offerings (ICOs):
Token sales and ICOs are other ways to make money through Cryptocurrency. This is usually in two ways as one needs to be hopeful that the said projects that are investing in will turn out to be a success. There are stories of individuals who bought some ICOs and ended up making 10x their investment when the projects went on to do well. Only about 45% of ICOs from 2022 were said to have been successful.
Yield Farming and Liquidity Mining:
This is when participants provide liquidity by supplying their tokens to a decentralized finance (DeFi) protocol and then earn rewards in the form of tokens. These tokens earned could be the same tokens supplied or of other projects.
This venture can be very profitable, but it also carries risks associated with smart contract vulnerabilities, impermanent loss and market fluctuations.
Mining:
An individual can engage in Cryptocurrency mining to earn the network’s token.In easy terms, mining is when you take out time to do some special computer work on the Blockchain network. `
For any transaction to be successful on the blockchain network, they need to be validated/approved and this usually involves solving complex mathematical problems. The miners then get rewarded in new coins for their effort and work.
To be a Miner, you must be ready to invest in hardware and electricity for tokens like Bitcoin, Litecoin, Monero etc.
Content Creation:
Lots of projects offer rewards in cryptocurrency to content creators
who can create written cointents, video explainers, infographics and educational materials that talks about Blockchain, Cryptocurrency and Web3. The cryptocurrency markets can be highly volatile and unpredictable, and prices can experience significant fluctuations which usually results in losses.
While it is exciting to want to start making money in the listed avenues above, it is advised that you do thorough research, understand the risks, and only invest what you can afford to lose when participating in the cryptocurrency market
