Cryptocurrencies are speculative assets as well as a store of value. For cryptocurrency users, this means that there are now plenty of ways to generate returns from your cryptocurrency holdings. Here are six we’ve picked out.
The original way to profit from cryptocurrencies, trading and investing in 2021 has something for everyone. Whether you want to swing trade cryptocurrency-backed futures, day trade token pairs, or dollar-cost-average your monthly savings, you can find a way to do it in crypto.
Moreover, cryptocurrency trading has come a long way since the early days. As regulators have taken an interest, segments of the cryptocurrency industry have stepped up in response, providing a more reliable and secure user experience. As a compliant exchange and part of a NASDAQ-listed company, EQONEX is an excellent example of this. We guarantee that we don’t make markets on our own exchange and always provide total order book transparency.
Staking is rapidly becoming one of the most popular ways to generate returns on cryptocurrencies.
The EQONEX utility token, EQO, is a great way to generate a return from staking. EQO token holders that stake their tokens on the EOQNEX platform will be eligible to receive more EQO tokens every day through the daily reward batch. Tokens can only be earned through trading or staking existing EQO tokens held on the EQONEX platform.
One challenge with staking is that it locks your funds away so you can’t access them, which isn’t a problem suffered by decentralized finance users. It’s a risky business, too often fraught with rug pulls and buggy smart contracts, but the rewards can be considerable if you dare to dabble in DeFi.
If you’re game enough to take the plunge, an easy way to start is to deposit your crypto in a lending pool on one of the flagship protocols such as Aave or Compound and start earning interest. There’s an entire rabbit hole of liquidity tokens, flash loans, and tokenized synthetic assets to explore for the more adventurous.
CeFi lending is another way to generate income on your cryptocurrencies.
The principle is to lock up your cryptocurrency with a provider and receive rewards for doing so. Typically, stablecoins receive a higher rate of return than cryptocurrencies simply because there’s more demand for them from borrowers. An aggregator service such as Coinmarketcap shows the latest rates from a variety of providers.
In light of the recent Chinese government clampdown, there’s been a significant shakeup in the cryptocurrency mining space, such that if you’ve ever considered getting into mining crypto, there’s perhaps never been a better time. The market is currently flooded with secondhand mining equipment, and as a result, Bitcoin mining is becoming considerably more decentralized as mining power moves out of China.
Of course, there are also the running costs to consider and the sustainability perspective unless you already have a green energy supply. A mining calculator like CryptoCompare’s can help you figure out all the variables involved.
Forks and airdrops can offer legitimate ways to get free cryptocurrencies, but they’re generally out of your hands. For instance, when a blockchain undergoes a hard fork like the Bitcoin Cash or Bitcoin SV forks, users typically receive a matching balance of the new cryptocurrency.
Airdrops may happen similarly, where a project determines a set of users who are eligible to receive some tokens.
Beyond the few examples listed here, be wary of any cryptocurrency giveaway offer from unknown entities. In particular, never give away your private keys. After all, there are plenty of legitimate and safer ways to earn returns on your cryptocurrency.
While much of the headlines are dominated by the price of Bitcoin (BTC) and constant debates over whether we’re in a bull or bear market, the Bitcoin network carries on undeterred, mining a new block every 10 minutes. Read five fascinating facts about the OG crypto here.
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