Do you still regret passing on the chance to buy bitcoin when it was worth only a few dollars ten years ago?
Well, you are not alone. Most people at that time didn’t believe in the potential of blockchain and cryptocurrencies.
With the advent of the Metaverse and NFTs, however, the popularity of crypto has soared in recent times. And everybody’s looking to make some bucks out of this technology.
So here are 6 ways you can invest in crypto (and make good returns).
1. Buying And Trading Cryptocurrencies
The most well-known cryptocurrency is Bitcoin, and buying it remains the simplest way to invest in crypto. While the price of Bitcoin has shown volatility and decline in recent times, experts still predict it to be the strongest future cryptocurrency based on its steady growth over the last decade.
And being the most popular and expensive cryptocurrency, Bitcoin is easy to buy and sell. Other popular cryptocurrencies include Ethereum, Solana, Luna, and Binance Coin. These can also be easily traded as they are always in demand.
Make sure you learn how to buy cryptocurrency and educate yourself about blockchain fundamentals before making a purchase.
When trading cryptocurrencies, you will need to use a cryptocurrency exchange. These exchanges act as middlemen and charge a fee for using their platform.
You must have heard the names of some popular exchanges from a friend or colleague. These include Binance, Coinbase, and Kraken, but you need to research to find the best exchange for you.
Every exchange might not be offering the currency you want to invest in. Plus, each exchange has its own fees and availability options for different countries.
Keep in mind that trading cryptocurrencies could be risky, as prices can fluctuate rapidly. So, it is essential to do your research before you start trading and invest only what you can afford to lose.
2. OTC Trading
Over-the-counter (OTC) trading is a way of buying and selling cryptocurrencies that is not done on an exchange.
OTC trading is a more private setting that is often done through brokers, and it can be an excellent way to get better prices for large trades. This trade can either be crypto-for-crypto or fiat-for-crypto.
However, it is important to ensure that you use a reputable broker. If you’re just starting out, OTC trading with Independent Reserve is a safe idea.
3. Mining Cryptocurrencies
Mining is the process of verifying and adding transactions to the blockchain, and miners are rewarded with cryptocurrency for their work.
It is possible to mine cryptocurrencies on your own, but it is often more cost-effective to join a mining pool. This is where miners work together to mine a cryptocurrency, and rewards are shared among the group according to how much work each miner has done.
The most popular mining pool is Bitcoin.com, but there are many others to choose from. F2Pool, Slush Pool, and Antpool are high-performing pools that most miners recommend for beginners.
4. Staking Or Holding Cryptocurrencies
Staking is the process of holding a cryptocurrency in a wallet in order to support the network. In return for staking their cryptocurrencies, users are rewarded with interest. For enhanced staking returns, we suggest you get familiar with Interest Compounding ETH Index (or icETH).
A similar method for making money with cryptocurrencies is Holding or HODLing*. This involves buying a cryptocurrency and holding onto it for a long period, hoping that it will increase in value.
*In the world of crypto investing, HODL means “holding on for dear life.”
This is a more passive way of making money with cryptocurrencies, as you don’t need to actively trade or do anything other than holding the currency in your wallet.
5. Lending Cryptocurrencies
Lending your cryptocurrency is a way of earning interest on your investment. It involves an agreement between the borrower and lender (you) that connect through a crypto exchange. And just like regular lending or loans, you earn money through interest or “crypto dividends.”
Although it can’t be done on every exchange, several platforms allow you to do this. These include BlockFi, Celsius, and Nexo.
Again, this is not a risk-free investment because crypto loans are not insured like bank loans. Still, if you find a reputable and trustworthy exchange with a solid history, it might be a good idea to consider lending.
6. Creating Or Trading NFTs
Non-fungible tokens (NFTs) are crypto-powered digital assets that can be bought and sold like real-world assets. However, they can’t be bought with fiat currencies, which is why you need cryptocurrencies to invest in an NFT.
But what exactly is an NFT? Well, NFTs can represent anything from digital art (images, gifs, videos) to virtual in-game assets like real estate, player skins, voices, rare coins, and more.
These unique items can’t be duplicated, and their scarcity gives them value — the rarer the NFT, the higher its price.
NFTs are bought and sold on online marketplaces like OpenSea, Rarible, and Foundation. You can also create your own NFT and put it up for sale on one of these marketplaces.
So there you have it — six ways to invest in crypto. Some carry more risk than others, but all of them have the potential to make you money if done correctly. Good luck!