Are you looking into how you could earn some extra money and thought that cryptocurrencies could be a possibility? Then you are right. There are many good ways of earning money from crypto. But there are also lots of scams.
But what is great with cryptocurrencies is that they provide people from all over the world with new ways of earning money. Often the older ways of earning money have favoured the few and rich.
So in this article, we will list our and the crypto community’s top ways of how you can earn money from cryptocurrency in 2020. We want to make it as easy as possible for you to find your favourite way of earning some extra income from crypto.
We ourselves here at Go CryptoWise are using several of the listed methods below, so we know what works and what doesn’t.
15 Proven Ways of Making Money from Crypto
1 ) Day trading crypto
With day trading we mean that you buy and sell cryptocurrencies the same day or the following days. This is a method commonly used by both crypto and stock traders. Where you, for example, buy low and wait to sell higher.
It is common for day traders when they get more experienced that they move beyond buying low and selling high strategy, to implementing short tactics. Which means when you go short you bet on the price of that crypto to fall. So when you short a cryptocurrency you will profit after that cryptocurrency’s price has fallen and you could sell it for profit.
Day trading could be one of the most lucrative ways of how you can make money from crypto in 2019. But it comes with higher risks. Few traders actually are successful trading in the long run. So it’s important to research before venturing out to day trade.
You can also use crypto trading bots for day trading crypto. Learn more in our guide to crypto trading bots.
Where you can day trade crypto and Bitcoin:
(Where the best trading volume is for the cryptocurrency you want to trade. So it depends, but here are our favourite crypto exchanges)
Important to know about day trading:
- Have a clear strategy for your trading – no plan = no success
- For each trade, set profit targets and stop losses. Trading without those is just playing with fire
- Avoid FOMO! As part of tips #1 you should have a clear strategy for how your cryptocurrency trading works. That means that FOMO doesn’t exist in your world.
- Risk management! Never trade more than you are willing to lose. And each trade should only consist of a small percentage of your cryptocurrency trading portfolio.
Learn more about day trading
2 ) Buy & Sell for a profit later (HODL)
One of the most common ways of and less risky ways of making money is by simply buying crypto, like Bitcoin and waiting for its price to increase. This method is by far the simplest. All you need to do is buying crypto at a crypto exchange and store your cryptos in a safe crypto wallet and wait.
Imagine if you would have bought 1 Bitcoin (BTC) back in July 2010 just 8 cents and sold it for $8092 today. Or bought some Ether back in August 2015 for 71 cents, and sold for $171 today. And the list goes on. So you could invest into either of those and it would a smart decision in a few years time. But you could also look into investing into the next Bitcoin or Ether.
It is important that you research beforehand which cryptocurrency to buy. You might have heard about Bitcoin before. But there are thousands of cryptocurrencies besides Bitcoin. Famous ones are Ether, Ripple, Stellar. You can check out our cryptocurrency reviews page to find more.
To learn more about investing smartly into crypto read our guide on the subject.
Top crypto exchanges that we recommend:
3 ) Staking cryptocurrencies
You might have heard about mining Bitcoin? Which is how the Bitcoin blockchain works. But there is a newer model known as staking cryptocurrencies or Proof of Stake model (PoS). With staking cryptocurrencies you ‘stake them’ in a crypto wallet. And by staking your cryptos, you help to secure the blockchain and get rewarded by doing so.
Staking cryptocurrencies is a great way to passively earn some extra income. And it is a model we use because it is super easy and we never say no to some extra income.
Our favourite coins to stake are right now: VET, NAV, and NEO
Learn more about staking cryptocurrencies:
4 ) Mining cryptocurrencies
The original and most famous way of making money in the crypto world and Bitcoin was via mining. Also known as the Proof of Work (PoW) model. Back in 2009 and in the first few years mining, Bitcoin was something everyone could do with their home computers. It was really easy back then to do it with cheap equipment.
But as Bitcoin’s price continued to rise more got interested which meant that miners started using better computers and equipment. Soon the days were over when you could mine with your graphics cards. And today mining Bitcoin is done by companies and people with expensive mining rigs.
There are of course other cryptocurrencies that run on a PoW model. But most need a more advanced mining rig in order to be profitable.
Useful guides and sites:
5 ) Running a Masternode
Running a Masternode means that you are helping out to secure a Proof of Stake blockchain a bit more than just via staking your cryptocurrencies.
It works like a traditional computer that needs to be running at all time to secure transactions and in return, you earn a higher amount of coins/tokens as a reward than traditional non-node staking.
Masternodes are more difficult to set up compared to staking. And you, for example, need your node to be up and running at all time, in order connect to the blockchain and earning passive income from crypto. Learn more about running Masternodes. But if you have an extra computer at home it might be a great way of earning some extra cash without too much effort.
Great coins to run Masternodes with:
Find a full list of coins here. Masternodes are a bit more complex and requires a bigger investment usually then staking coins without a Masternode.
- DASH – 7.6% annual ROI. One of the most well-known options is DASH. Where you can earn up to 7% annually. The only problem is that you need to hold at least 1000 DASH coins, which costs about $82k. Find more information here Buy DASH at Binance, OKEx, eToro, Kucoin, Bit-Z
- ZCoin – 17% annual ROI.
- Another option is the privacy coin ZCoin. Where you can host your own node if you have the latest Zcoin wallet and you have already obtained your 1000 XZC. Find more information website and on their ZCoin guide – Buy ZCoin at Binance
6 ) Accepting cryptocurrency payments as a merchant
Another way that people forget about is accepting payments in cryptocurrencies at your shop or business. Nowadays there is more common that people have Bitcoin and other cryptocurrencies. So instead of just accepting cash (Fiat money), debit and credit cards at your shop, you could accept cryptocurrencies like Bitcoin.
It is a great way to attract additional interest in your business and could help to promote your business locally and nationally. If you would start accepting cryptos at your shop make sure you let your customers and social media know. It might gain a lot of traction at sites like Reddit which can boost your sales.
Find out more about accepting cryptocurrencies
7 ) Lending out your cryptocurrencies
A new way that you can use to make some money from cryptocurrencies is by lending them out to others. Often if you don’t day trade your cryptocurrencies just sit there in a wallet. And you might hope that their value will increase one day.
But there is another thing that you could do with them in the meantime. Lend your cryptocurrencies out to others! In this way, you earn interest from the users that you lend them out to. And don’t worry there are companies that facilitate this whole process. And they will also secure your cryptocurrencies when they’re lent out. So no need to worry about your cryptos getting lost or stolen.
Companies that provide crypto lending services:
- BlockFi provides this service in an easy way (read our interview with the Director of Marketing Brad from BlockFi here).
- Ethlend is a decentralised p2p lending platform that uses Ethereum smart contracts to connect lenders and borrowers.
- Another option is Salt Lending which provides a slick service and fully insures your cryptos to 100%.
“BlockFi Interest Account users can deposit their Bitcoin or Ether and earn up to 6% interest annually. Paid out on at the beginning of every month, the interest earned by account holders compounds, increasing the annual yield for our clients to 6.2%. This is an easy way for crypto investors to earn bitcoin while they HODL.”
8 ) Margin funding
With margin funding, you basically lend out your cryptocurrencies out to other traders, for their margin trades. You then help the crypto exchange with the funds necessary for the traders when they need funds for cover.
Margin funding is an easy way to earn interest and make money from your cryptos if they are otherwise just sitting in a crypto wallet. And most good crypto exchanges provide full insurance to your cryptocurrencies. So there are no risks involved.
Margin funding works similarly like lending, where you lend out your funds and sign a contract with the crypto exchange. And you can end it whenever you want.
They can speculate that the price will go down (short position) or go up (long position). Traders who open long/short positions use real funds to ‘bet’ on that trade going their way.
This is how it works – margin funding via OKEx
- Users who want to margin trade on OKEx uses funds from a margin funding pool – call them margin traders
- Users who want to earn profit and passive income from their funds sitting on an exchange allocates their funds to that margin funding pool and get paid in return call them margin funders
- The margin traders then use the funds to open a long or short position and uses funds from the pool. When they close their position the funds are returned to the margin funders
9 ) Affiliate marketing
Affiliate marketing is another interesting way that you can start with to make some money from. And there are many different crypto affiliate methods to start with.
Some of the most common and popular methods are by referring users to sign up at crypto exchanges, like Binance, OKEx, Bit-Z, etc. If you refer a user to sign up at a crypto exchange then usually you get 10-40% of their trading fees.
Another very interesting crypto exchange you could use to start earning some good money is ChangeNow. They let you set your own referral rate when inviting new users to the platform.
Another way to earn affiliate money in crypto is by writing product reviews. But always be truthful and honest in your reviews about the products.
Tips to succeed in crypto affiliate marketing
- Be helpful and provide a useful service. There’s no way you will earn a bunch of money from affiliate marketing if you don’t provide a useful service that people like
- Sign up at this link for Binance and you will get a 5% kickback from all of our referrals. Forever.
- Find more affiliate marketing opportunities in our deals section
10 ) By doing crypto jobs
The most common way to earn money anywhere is by providing a service that someone wants to pay you for. So if you want to combine your crypto interest with your everyday skills then doing a job and asked to be paid in cryptocurrencies might not be such a bad idea?
For example, if you have a big following in the crypto industry, you could target companies that are planning to run their ICOs or IEOs if you could help to promote them.
Or if you are a talented writer why not write for crypto websites and blogs? Even we at Go CryptoWise sometimes need extra writers. Or maybe you are a graphic designer and could help to design logos or websites. Or maybe coding is your forte. Then you shouldn’t have a problem looking for jobs that pay in crypto.
Maybe you can help to find bugs when new blockchains are creating new features or launching their main-nets.
Our best tips for getting crypto jobs:
- Be seen in the right place. That means to promote your services, whether you are writing, designing, developing, marketing in the right places. Like Reddit, Bitcointalk, Facebook, etc.
These websites help you find crypto jobs:
11 ) Participate in crypto airdrops
A crypto airdrop is usually a promotional marketing effort to gather people’s interest in cryptocurrencies, by ‘airdropping’ out cryptocurrency funds for free.
Usually, you don’t need to do much to participate. The companies might require you to follow them on social media or retweet a post of theirs.
Participating in crypto airdrops are a great way of getting some extra cash in for doing very little.
Use these sites to find upcoming airdrop events:
12 ) Participate in crypto bug bounties
If you are a talented coder then participating in crypto bug bounties might be a smart thing to look into. Bug bounties are often held by various companies, and in the crypto space, it is strongly associated with the release of new features and mainnets by blockchain companies.
Before releasing the blockchain to the public these companies host their own bug bounties where they invite coders and hackers to try and find bugs in the code. Meaning find problems with the code which could at some point make the code break, or cause risks to the security of the blockchain.
So to prevent these risks closed bug bounties are often held to discover them before launch. And if you find bugs in the code then these companies reward you (often handsomely) for helping them out. There are many people and companies around the world that specialise in bug bounties. Because it is often very well-paid.
If your skills needed then participating in bug bounties is a great way of making money from cryptocurrencies.
To find out more about bug bounties:
13 ) Investing in ICOs / IEOs
During the height of 2017, when the interest in cryptocurrencies was at its highest investing in ICOs and making a profit was easier than ever. There was so much hype in new cryptocurrencies. Everyone hoped that they would find the next Bitcoin or Ether.
So with this hype and interest surrounding cryptocurrencies investing in an ICO meant that you could easily earn 2-20x your money in just a few days or weeks.
An ICO (Initial Coin Offering) or nowadays IEO (Initial Exchange Offering) is a way for blockchain companies to raise funds for their operations. With ICOs and IEOs it is completely open for the public to participate in the funding. With ICOs or IEOs you invest with your cryptos, usually Ether or Bitcoin and in return when the project is launched you get new tokens back.
And hopefully, you can sell these new tokens to other investors when they are released for trading at a crypto exchange.
Important tips about investing in ICOS / IEOs:
- Make sure you research the company that you invest in. Make sure you understand the business idea behind it. Don’t be stupid with your money and investments
- Be aware that ICOs & IEOs are very risky. The companies behind them provide you with no security. Just promises that they will one day launch their product or service. And you the hope that speculating in this new cryptocurrency will pay itself off. There are no certainties with ICOs & IEOs
To find out more about upcoming ICOs & IEOs
14 ) Get passive income from trading exchanges
Did you know that there are two famous crypto exchanges, KuCoin, and COSS that give you a part of the trading fees? That is a great way of earning passive income from doing nothing. With both KuCoin and COSS you who hold their tokens get a part of the money that they make from trading fees.
Important to know:
- KuCoin shares 50% of its trading fees. And of course, do more KCS you hold the more you will get back in income. Calculate your KCS income here
- COSS also shares 50% of all their trading fees with COS holders. Find out more about how much you can earn from COSS
15 ) Blogging and tipping received
Are you maybe a writer, or someone who’s like to write as a hobby? And are you also knowledgable about cryptocurrencies and blockchain?
Then what you could do is combine these two and start writing about cryptocurrencies and blockchain and start earning money.
This could be done for example by:
- Getting paid as a full-time or freelance writer for crypto news sites and blogs. For example, the big ones are Cointelegraph and Coindesk
- The other possibility is to write for sites like Publish0x, Steemit or Trybe and earn by receiving tips from your readers
Both of them are great opportunities to make some extra crypto on the side, or even as a full-time job.
We hope that you liked this guide on some of the different and best ways of earning cryptocurrencies. Both if you are looking for a side income, or even as a full-time job.
There are many great ways that you could start with right now to earn some extra money. And they are not all that hard. It, of course, depends a bit on your skills, time and interests.
I myself do a few of these on a regular basis and I’m also doing it as part of my interest in cryptocurrencies and blockchain technology.
Other popular guides
- 120+ Ultimate list of handy Crypto tools & sites 2019
- How to Sell Bitcoin for cash – ‘cash out BTC’
- The best Bitcoin and cryptocurrency wallets
- 11 important crypto tips to be aware of before investing
Per Englund – Founder of Go CryptoWise a cryptocurrency and tech fan that want to see better and smarter products and services that makes our lives better and easier