Cryptocurrency has become one of the most popular investment options in recent years as it has continued to pave the way for a decentralized global banking system. We have seen a drastic rise in the quest for how to make money holding crypto. Although many people are still unsure about investing in cryptocurrency, the industry is undoubtedly experiencing steady growth.
The ongoing drive for a decentralized financial system all over the globe means that many businesses are more open to accepting different kinds of cryptocurrency in transactions. The rise of Bitcoin, Ethereum, and other digital tokens, means that there are more options to do this. Approximately half of all cryptocurrency investors want to make money. According to Binance Research, crypto investments are the primary source of income for around 52% of those who enter the industry. Around 15% of people consider making money in crypto to be their principal source of income.
Now with these staring you in the face, the question that comes again is: is it possible to make money holding crypto assets?
The answer is a resounding yes! Although the crypto market can be volatile, there are many proven strategies to make money holding crypto assets. According to a recent survey, more than 60% of crypto investors said they earned a profit in 2020.
In this article, we will discuss five proven strategies to make money holding crypto assets. From long-term investing to short-term trading, we will cover the most effective ways to build wealth through the crypto market.
Is Holding Crypto a Good Investment?
Yes, holding crypto is a good investment. Though the price of Bitcoin has been volatile, and most other cryptocurrencies have followed its larger price fluctuations, this volatility has only done more in attracting investors who seek to benefit by buying cheap and selling high. According to Fortune Business Insights, a conservative estimate puts the worldwide cryptocurrency market size at $754 million in 2019, with a CAGR of 11.2% to $1,758 million by 2027. Despite being a relatively new technology, it’s no doubt that the crypto market has seen rapid growth in a short time, and is expected to continue to expand in the coming years.
In addition to the outstanding returns, crypto investments are also attractive because of their low cost, as well as their security and liquidity. Since crypto is decentralized, it is not subject to the same regulations as traditional investments and can be bought and sold with much lower fees. Furthermore, crypto investments are highly secure, as all transactions are recorded on the blockchain and are almost impossible to tamper with. Finally, because crypto is a digital asset, it is highly liquid, meaning investors can easily convert it into cash.
Overall, holding crypto is a good investment due to its high returns, low cost, security, and liquidity. With its potential to yield high returns and its increasing popularity, crypto has earned its place as a viable and attractive investment option.
How Do Crypto Millionaires Make Money?
More often than not, we have heard the question asked, “how do crypto millionaires make their money? Crypto millionaires made their money by investing in and trading cryptocurrency. Many crypto millionaires have made their money through investing in the right crypto assets at the right time and then trading them for a profit, trading in cryptocurrency markets, mining cryptocurrency, staking cryptocurrency, lending cryptocurrency, and participating in Initial Coin Offerings (ICOs). They can also earn money by providing services related to cryptocurrency, such as developing apps, creating wallets, or providing consultancy.
Crypto millionaires often use strategies such as day trading, swing trading, and long-term investments to maximize their profits. Crypto millionaires also use strategies such as arbitrage to generate additional income from their investments.
Holding Crypto vs Trading
While holding crypto is the process of buying and storing cryptocurrencies for a long-term investment, with the goal of either capital appreciation or receiving dividends. It involves buying a specific cryptocurrency, preferably one that has a good track record of increasing in value and holding it for a while without selling it. It has become a popular strategy among cryptocurrency investors as it allows them to benefit from long-term price appreciation. This method also allows investors to avoid the day-to-day fluctuations of the market, as well as the fees associated with frequent trading.
Trading crypto, on the other hand, refers to the process of buying and selling cryptocurrencies for short-term gains to make a profit by taking advantage of market movements. Trading crypto requires knowledge of technical analysis and charting techniques to be successful. This type of trading is typically done using leverage, which allows traders to take bigger positions with less capital. It can also involve using trading tools such as chart analysis, technical indicators, and automated strategies to identify and capitalize on opportunities in the market. Trading crypto is riskier than holding crypto, as it requires a greater understanding of the market, and the ability to make informed decisions quickly.
Taking Profits vs Holding Crypto
Taking profits vs. holding crypto are both viable options predicated on your portfolio and goals. The decision to take profits or hold crypto is entirely up to you and should be based on your individual goals and risk tolerance.
Taking profits is the purposeful act of selling cryptocurrency or another investment to lock in profits after a period of appreciation. In contrast to HODLing, it often entails regular trading and market engagement.
HODLing, which stands for “holding on for dear life,” is a hands-off approach to investing. Although this crypto profit-taking approach has helped build a lot of wealth for those who have the foresight to purchase cheap and get in on the ground floor of Bitcoin, Google, Amazon, or other financial assets, it takes a long time to see a big return on investment. In other words, it requires a lot of patience.
So, both methods provide succinct answers to the question of how to make money in the crypto market when leveraged upon.
Do You Make Money for Holding Crypto?
Yes, you can make money by holding crypto. You can make money from cryptocurrency by holding and HODLing it for the long term. Cryptocurrency holders can benefit from price appreciation, earning interest on their crypto holdings, and more. When you hold cryptocurrency, you can potentially benefit from price appreciation and earn interest on your crypto holdings. Holding crypto for the long term can be profitable as the market fluctuates and can potentially increase your returns if you are patient. Additionally, some crypto exchanges and platforms offer rewards programs that can help you make money for holding crypto.
How to Make Money Holding Crypto
Making money holding crypto is a popular strategy among crypto investors. It involves buying crypto assets and then holding them for a long period, in the hopes that the value of the asset will increase over time.
These are the five (5) ways to make money holding crypto.
1. Buy and hold crypto on a crypto exchange.
Buying cryptocurrency on an exchange and holding digital money is one way to make money in the crypto market. This takes a basic understanding of chart analysis to predict when the market will revert from a negative trend to an upward trend. The buyer then buys at a lower price and sells at a higher price before the coin’s price reverses to a downtrend. Analyzing this market technically and methodically aids in profit maximization.
Another way to make money holding crypto is by lending your coins. By lending your coins you can earn interest in return for providing liquidity. This can be done through lending platforms or peer-to-peer lending networks.
You must register for a lending platform, decide on a supported cryptocurrency to deposit, then transfer funds to the platform to become a crypto lender. Interest may be paid in kind or using the platform token’s native currency on a controlled crypto lending platform. There may be bonus payments on a decentralized exchange, although interest is often paid out in kind.
Staking is one of the most popular ways to make money holding crypto by locking up your coins in exchange for rewards. The rewards are usually in the form of interest from other cryptocurrencies or tokens. Staking can be done through exchanges, wallets, or other services.
You can “stake” a portion of your cryptocurrency holdings to receive rewards over time, provided that the cryptocurrency you own allows it (current possibilities include Cosmos, Solana, Ethereum, Tezos, Cardano, and others).
Your cryptocurrency earns rewards while being staked because it’s working for the blockchain. A “consensus mechanism” known as Proof of Stake is used by cryptocurrencies that support staking to guarantee that all transactions are safe and confirmed without the involvement of a bank or payment processor. You may participate in that process by choosing to stake your cryptocurrency.
4. Buy and hold crypto before listing on an exchange
The most profitable way to hold crypto is to buy it before listing it on an exchange directly from the issuing platform. This is because the price on the issuing platform is usually lower than the price it will be listed on the exchange, meaning that you can benefit from a higher return on investment. More so, it is generally easier to buy directly from the issuing platform and there is less risk of fraud or manipulation.
5. Providing Liquidity
By giving your cryptocurrency assets to a platform as a liquidity provider to help in the decentralization of trading, you take on the role of a market maker. In exchange, you get fees on trades made on that platform, which are comparable to a sort of passive income.
During the duration that the user chooses to supply liquidity, the given assets are locked with the platform.
You would be providing a certain amount in the form of a token pair, which is used to generate liquidity and is locked in smart contracts. Decentralized exchanges often use liquidity pools, and they receive the liquidity you give and deposit it there. By the token pair, it stands for, a liquidity pool is identified. The liquidity supplied for the token pair ETH and USDC, for instance, is included in the liquidity pool ETH-USDC.
Make Money Holding Your Crypto on TransferXO
You can now make money holding your crypto on TransferXO! If you’re looking for a secure and easy way to make money holding your crypto, then you should consider TransferXO. TransferXO is a secure, reliable, cost-effective, safe, and user-friendly cryptocurrency exchange platform that allows you to earn money by simply holding your crypto on the TransferXO Exchange.
With TransferXO, you can hold your crypto and make money at the same time. Even when you choose not to trade or speculate, you can just hold your crypto and still earn rewards. TransferXO also offers great customer support and a wide range of trading features and tools that make it easy to make money holding your crypto, such as low trading fees and a variety of tools to help you manage your portfolio. So why not start earning money today by holding your crypto on the TransferXO Exchange? Make money holding your crypto on TransferXO Exchange!
By following these five proven strategies, you can make money holding crypto assets. Whether it’s buying and holding for the long term, lending to earn interest, staking to earn rewards, providing liquidity to earn fees, or buying and holding before listing on an exchange, you can benefit from the growth of the crypto market. TransferXO remains a secure and easy-to-use platform for buying, selling, and trading crypto assets. With TransferXO, investors have a great opportunity to make money holding crypto assets and grow their portfolios.