As of this writing in September 2024, cryptocurrencies had a market capitalization of $2.13 trillion, which is a small fraction of the $71 trillion in assets that are bought and sold throughout the world. As interest in digital assets increases, there is a chance for some investors to see significant returns on their capital. Here’s a look at some of the strategies that you can use to do so.
Add Crypto to Your Existing Investment Portfolio
The primary difference between an investor and a trader is the amount of time that an asset is held. Investors typically hold assets for years or decades while traders tend to hold assets for a period of hours or days. Investing in digital currencies can might risk since the longer-term time horizon means you can ride any short-term dips in price for long term gains.
When buying cryptocurrencies for a long-term investment you want to get it at the lowest possible price to maximize profits. Investors must conduct fundamental and technical analysis on each coin before investing. Let’s say that through your research you identified Toncoin as a promising coin to invest in. The Toncoin price chart as of this writing, according to Binance, showed a +137.82% increase in price with a price at $5.62 (subject to change).
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Based on a “buy the dip” long term investment strategy you may want to set a lower price where you want to buy into this coin as well as a stop loss and profit taking price. This is no guarantee that you will make a profit, but it does give you a chance to make an informed investment while minimizing potential losses.
Lend Your Coins to Traders or Investors
If you don’t have any plans to liquidate your crypto holdings in the near future, you might be able to make money by lending them to other people. As with any other loan, a borrower will pay interest until the principal balance is repaid in full. It might also be possible to lend coins through cryptocurrency exchanges or through peer-to-peer lending platforms.
Free Coins May Be Available
Every so often, a blockchain will fork, which means that the current network is being altered or upgraded. Those who have coins on that chain will often be rewarded with tokens on the newly created network. An airdrop occurs when a new exchange literally gives people tokens to generate awareness of its presence and attract a significant number of active users.
Mining Is Still an Option
In previous years, you could mine for Bitcoin using nothing more than a standard desktop computer. Today, mining for Bitcoin requires specialized equipment that can be expensive to run and maintain. However, it is still possible to obtain rewards such as new coins for taking the time to validate transactions on a blockchain. If you aren’t interested in acquiring new coins, you can attempt to make money by creating a masternode. A masternode is copy of an existing network that is kept inside of a digital wallet.
Earn Digital Currency By Creating or Curating Content
Sites such as Narrative and Sapien may allow you to earn tokens by posting original content or by posting links to interesting articles or videos. In addition to earning money, being active on these platforms may give aspiring writers, singers or artists a chance to gain a larger following.
While there are risks to investing, trading or lending digital currencies, doing so may offer legitimate opportunities to earn money. It may be a good idea to speak with a financial planner or tax adviser prior to making transactions involving cryptocurrencies. They may be able to provide more insight into the risks that you may be taking or the tax implications of profiting from a trade or investment.
This content is for educational purposes only. Your situation is unique, and the products and services discussed here may or may not be right for your individual situation. This is not an offer of financial advice, or financial services. Performance information may change. Past performance is not indicative of future results. All investing includes the risk of loss. The opinions expressed here are that of the contributor alone.
Lee Enterprises’ newsrooms were not involved in the creation of this content.
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