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The Many Ways To Earn Passive Crypto Income

Scott CunninghamMay 25, 2020, 5:14:38 AM

There are so many ways that you exchange or earn cryptocurrency, but how many coins and projects are dedicated to helping you grow that wealth? Let’s dive into the ways you can earn passive crypto income together.

A few terms to note are:

APR (annual percentage rate) - which refers to how much you’ll earn from your investment. $1000 stored for 1 year at an APR of 10% yields $100 per year.

Tokenized – Taking an asset and converting it into shares that are represented with unique cryptocurrencies.

Liquidity – Refers to how much cryptocurrency is backing a trading pair and how easy it is to either sell or buy. For example a new coin may have very low liquidity where if someone wanted to buy or sell 10,000 of it, they may not be able to find a buyer or a seller for some time.

Staking – Locking your cryptocurrency into a platform or contract for either a set amount of time or there is a stakeout period. For Steem, staking out takes 13 weeks, for Tron, after 3 days you can unstake at any time. There are exceptions with LBRY where you can stake and unstake without restriction.

The 4 main ways I’ve been earning crypto passive income are:

Hard Staking – Locking your coins into a contract for a set period of time for a higher APR

Soft staking – Holding your coins somewhere that will allow you to earn a lower APR

Fee and payment sharing – Investing in coins that are associated with something that pays fees like Kucoin Shares which pay out a percentage of the trading fees on their platform each day.

Crytpo real estate – Investing in tokenized real estate such as RealT.

Some other ways you can earn are:

Liquidity pool funding fee share – Investing into liquidity pools that operate similar to fee and payment sharing, but have less liquidity themselves. For example I funded a trade on the Bancor network by holding BNTETH, but when converting back is was a hassle because for some reason the ETH I got back was in tokens and I had to spend a great deal of time and get help to convert them into real ETH.

Lending – Lending your cryptocurrency typically pays out a good amount on coins that otherwise you might not make a lot from like ETH, USDT, and other more stable coins. Once you’re making less than say 6%, you’re probably taking on less risk to just invest in other alternatives.

Running a node for a network – This can earn you a lot of cryptocurrency, but you’ll have to invest a lot more into it and you’ll be acquiring that one token. If you’re confident in one single token, you can invest more into it, but if not, this is not good for diversification unless you have a lot of wealth.

Storage sharing cryptocurrencies – You can earn from various storage sharing projects like Storj, BitTorrent, and eventually LBRY.

I’m sure there are many other ways I might have overlooked or not considered myself and I would love for you to share them with me and everyone else in the comments below. Do you take advantage of any of these methods yourself? How do you earn crypto with crypto? Also don’t forget to like, share, and subscribe!