There are tons of ways to earn passive income investing in cryptocurrencies.
If you’re among those on reddit, who never thought you could make cool passive income with cryptocurrencies, better re-think and follow up this article till the end.
Initially, when I was still very new with cryptocurrency investment, I always looked up how to make passive income with cryptos on reddit to see most of the profitable ideas for college students.
Even on Google definitely, there are different ways, which I learned that, making money from Bitcoin and any other crypto is kind of mysterious, as well as hectic (especially when you’re a beginner).
This is what led me into finding most genuine ways to make cool passive income with cryptocurrencies. Let’s use this opportunity and talk about the meaning of passive income in the real sense.
What is passive income?
Passive income is a residual income, in such a way that it’s that type of income you earn, while you’re not doing anything again, after the initial effort made to setup what is actually bringing the income.
Investing in cryptocurrency is a source of income actually, but not all forms of its income is passive. These are crypto-coins that pays you, while you’re not controlling it constantly.
Active vs passive income
Active income involves earning crypto money in exchange for a service. It could be a salary, an hourly wage, commissions, or tips. It’s essentially a trade of your time for a fixed amount.
Most people choose to earn their living this way, and there’s nothing inherently wrong with that, so long as you understand that there will be a limit to how much money you can realistically earn.
That’s not to say you should quit your job (at least not yet), but if you’re looking for creative ways to start generating wealth, here are ways to make passive income with cryptocurrency.
Ways to earn passive income with crypto
Investors that has huge amount of crypto investment can earn interest on their coins, without putting much effort in earning passive income.
They mostly earn interest by just HODLing crypto passive income coins in their wallet possessions.
However, learning how to develop passive income stream is not just going to be for making passive income with cryptocurrencies.
It’s equally not only by holding these cryptocurrencies that has potential of earning dividends, but there are ways you can also make money fast with cryptocurrencies.
In this post, am going to walk you through all genuine avenues to passively make income with cryptocurrency, without getting into any form of crypto scams.
Now, let’s head to the ways to earn income from cryptocurrency.
1. HODLing dividend coins
This is very simple, because all you need do is just invest in buying a crypto asset that pays individuals dividend for holding it in their portfolio of investments.
This is one of the smartest strategy to earn money with cryptocurrency.
There are many crypto-coins that are like this, but not all of them that are worth putting your funds up for in the case of buying and holding to earn dividends.
However, there are still some of them that are worth bit of cash you can put in them, and some them are;
- BNB token
- BTMX token
- KuCoin shares
- Bix token
Binance coin (BNB) is still an asset owned by the Binance crypto exchange platform. Ever since the ICO, the crypto-coin has improved in its worth till date.
Aside from making some passive income holding it, your transaction fees on the exchange will be slash down, when you have it in your wallet while exchanging other cryptocurrencies.
I recommend you read my guide on how to reduce Binance crypto transaction fees.
This is an official coin of the popular BitMex cryptocurrency exchange. You will be earning USDT, when you HODL the crypto-coin in your portfolio.
This is a native cryptocurrency coin for the KuCoin exchange. Just like the Binance coin, it is also used as transaction fee, but not to reduce the charges.
You’ll be earning bonus for having KuCoin token shares. This is the bonus you earn on 50% trading fees for every transaction.
Bibox is an exchange similar to the Binance cryptocurrency platform, and has a native token called, BiX.
The Bibox token (BiX) can be used for paying various fees on the platform, and the holders of BiX tokens are rewarded with reduction on fees, as par chart.
There are other dividend cryptocurrency tokens that an investor can use to earn money passively by just having in their possession of their cryptocurrency investment portfolio.
2. Blogging for affiliate marketing
This method of earning Bitcoin passive income mostly favour bloggers and digital marketers that has huge following on social media networks like; TikTok, Instagram and Facebook.
Most of the cryptocurrency influencers on these network knows how to do affiliate marketing the right way to make money fast online.
If you happen to become one of these people, all you need do is produce a review, or write a guided tutorial and attach a link that will redirect your visitors to the product you recommend.
Most prominent bloggers like me have used this method to make huge passive income money online.
Cryptocurrency being an emerging niche currently, you can still find unsaturated products you can simply be recommended to people and earn commission when they make purchase using any of your links.
This cryptocurrency blog you’re currently reading also uses this affiliate marketing method to make money blogging.
Below are some of the companies that pays affiliate marketers handsomely:
Always try to make use of these products and know how they work, before recommending any of them to your visitors. Otherwise, you may come off with low reputation.
It’s not a good idea to focus on the money income aspect alone when you’re trying to recommend products to your visitors.
3. Receiving crypto airdrops
This is yet another easy way most beginners to earn monthly passive income online without any cryptocurrency investment.
If you are still new, or maybe you are still confused about what is meant by airdrops, please read; beginners guide on cryptocurrency free money airdrops.
In nutshell, crypto airdrops are the free tokens that new hard, or soft forked blockchain project that companies issue to most crypto investors in the process of creating awareness and building solid community for their latest decentralize projects.
They also try as much as possible to giveaway free coins to their potential investors. This is also one the best ways to get free cryptocurrency tokens which comes passively.
4. Crypto P2P lending
If you have cryptocurrency investment on an exchange (like, Binance), that supports margin trading, you can lend some amount of your assets to crypto leverage traders on a simple crypto backed lending platform.
Cryptolend is a crypto backed loans platform that can help you to automate this process if you give them access to your API keys, or you can also do it manually yourself.
Most cryptocurrency traders use this technique to make up-to 2% profit on their passive income investments on monthly basis, but opportunities like that are few and far between.
Typically, high lending rates occur during airdrops, or forks (Soft/Hard), when an abnormal number of people want to short an asset, and you can bank heavily while you try to make passive income with cryptocurrency
On Bitfinex, you can lend crypto-coins like; BTC, EOS, LTC, ETH, USDT, NEO and DASH including other 24 assets. At present, the best rates are about 0.02% per day, which works out to about 7% a year!
The catch is that these opportunities are often for short periods of time, because few traders will lock in a short position for more than 30 days.
5. Running Masternode
As a professional, or beginner investor that is always looking for how to make income with cryptocurrency, to run a masternode is yet another way to make passive income.
This process is as simple as holding cryptocurrencies to earn reward from Proof-Of-Stake (POS) and Proof-Of-Work (POW) together.
For an amateur;
“Masternode is simply a cryptocurrency full node, or computer wallet that keeps the full copy of the blockchain in real-time and is always up & running to perform certain tasks in order to get extra rewards”.
Some of these tasks are:
- Doing instant transactions
- Increasing privacy of transactions
- Participating in governance and voting
- Enable budgeting and treasury system in cryptos
But for each currency, there are certain limits of minimum coin holdings to run a node, alongside required hardware to run different nodes successfully and make profit from running the pure coin masternode.
- One needs a minimum amount of coins for that particular cryptocurrency masternode. (For DASH MN you need 1000 DASH units and for PIVX MN you need 10,000 PIVX units).
- The minimum number you should hold varies from cryptocurrency to cryptocurrency.
- One needs a VPServer to host that crypto wallet 24×7
- One needs a dedicated IP address to maintain transaction security
- One needs good amount of cloud storage space to store the whole blockchain.
To see best masternodes to invest in, read detailed guide on: Masternodes and how they work with cryptocurrency
6. Lightening nodes
If you’re a Bitcoin maximalist, this is one of the best ways to support adoption, while setting yourself up for future income.
The second-layer scaling solution has grown from 4400 nodes to 7800 in the first quarter of 2019, a 77% increase in a matter of 3 months.
Lightning nodes provide liquidity to the network, allowing payments to travel smoothly from origin to destination.
Node operators need to lock Bitcoin into payment channels for long periods of time to increase network capacity and they are rewarded with fees from the payments going through their channels.
Ultimately, a report revealed that BTC holders could make up to 2.75% returns from routing fees in a bull market, but stated that automating the process for non-technically oriented HODLers will require a lot of development.
7. Staking cryptocurrencies
This is one of the stress-free way of making passive income with cryptocurrency that you already own.
To make money with this type of cryptocurrency passive income, all you need to do is just to hold some passive income cryptocurrency in an open cryptocurrency wallet for staking.
In other to make money fast enough using this method, the cryptocurrency you’re holding must pass through the POS consensus mechanism for this method to be able to work for you.
And you need to keep the coins in an open wallet for a maximum time for new similar coins to be awarded to you for keeping such crypto-coins in your possession (or portfolio).
In-case you don’t even know what proof of stake means, let me give it a layman definition so you will get to understand what it means;
Proof-Of-Stake (POS) is generally applied to those cryptocurrencies that are pre-mined so that users have access to the coins for staking. This means that the supply of POS cryptocurrencies are fixed from the start and there is no block mining or forging reward like Proof-Of-Work (POW).
Example: Neblio (NEBL) is a POS cryptocurrency. If you stake, let us say 10 NEBL coins, over time in a year you will have 11-12 NEBL coins by just holding and staking them.
No extra effort… Isn’t it wonderful?
But in some POS currencies such as NEO, you need not even keep your coins in an open wallet 24 x 7!
Want to know the best passive income cryptocurrency?
See notable privacy cryptocurrencies to hold and stake below:
- BTMX (Available via BitMax)
- NAV Coin
In other words
Cryptocurrency can actually be a source of passive income if you understand and know your way around it.
To find other ways of how to create passive income with no money, or any cryptocurrency investment, read my post on ways to earn crypto with without investment.
Simultaneously holding, staking, lending or running different kinds of nodes with your cryptocurrency investment portfolio can make you substantial passive income.
Even though, there are some expenses to incur if one decides to choose making money running crypto nodes due to the minimum eligibility amount of cryptocurrencies and the type of required hardware to setup the nodes.
Mind you that for whatever you do, securing your cryptocurrency investment is the very first step to making passive income possible.
Always make sure to choose and secure your coins with one of the best cryptocurrency wallets in the market, otherwise, you may run a risk of loosing your crypto-investments instantly.