The Right Guide To Earn On Cryptocurrencies in 2020
Choose wisely not to lose the game
There are many opportunities to make money on cryptocurrency assets even during the bearish markets and the looming times of uncertainty, but it’s essential to realize that not all these ways are safe and straightforward as it seems at first glance. Casual investors are always seeking for a magic formula or a way to earn easily and with minimal actions taken. As a result, a lot of theories and speculations went around cryptocurrencies, which make this path only more complicated for new market players.
Thousands of enthusiasts around the world receive passive income by engaging in the crypto field. We just need to see the possibilities clearly. Let’s face the facts and the drawbacks of each option of getting profit from the crypto today.
1. Buy and Hold!
The first and foremost, a basic idea of crypto communities, still going strong. One of the most effective strategies is called “HODL”: set up a digital wallet of your preference, buy or mine your favored cryptocurrency, and that just forget about it for a long time — it may grow in price drastically and surprise you well one day. And you feel safe&sound, without the need to worry about rates or exchange hacks or trading bots.
This way, it’s similar to a bank deposit with much higher possible returns and possible sky-rocketing of unexpected assets such as DOGE. Though the wallet still may be hacked over time, unless you use a cold storage one. It’s also a decent thing to have an online wallet for purchases, while setting up a separate offline one — for storing substantial crypto amounts, without engaging it in any kind of operations. What can be easier?
2. Mining the Coins
Cryptocurrency mining used to be quite profitable and popular long ago before the crypto has gone to the Moon and mainstream. First miners who were spearheads managed to be successful to get digital coins without substantial investments. Nowadays, the situation is quite the opposite, though. The longest in history bear market effect of late 2018-early 2019 had reduced the overall market cap in almost seven times at it’s worst! And the heights of 2017 are never reached even today.
Next, the exceptionally high entry threshold and payback period for the equipment used to mine coins in 2020. That’s right — to mine profitably nowadays, one needs something more than just proper equipment in order to assemble a so-called “farm” rig (a particular power station consisting of a dozen powerful video cards & a special software). Building one rig at home won’t get you anywhere in 2020. Even the professional miners who run such “farms” desperately agree that this kind of achieving crypto is unprofitable already for most people and even companies today. The truth is, after another Bitcoin halving in May, the block reward has been reduced again, forcing many players to shut down their activities in the mining game and close the shop.
With the reduced supply of the #1 cryptocurrency, the bonus paid to miners for solving mathematical puzzles has been cut by 50% — to 6.25BTC per block. Summing these up — mining is not the thing anyone would recommend nowadays for casual users.
3. Cryptocurrency Trading
The scheme seems not complicated— just open your account on the exchange, transfer the money, buy or sell cryptocurrency with the desire to get rich at some point. There are a variety of cryptocurrencies: buying cheaper and selling at a more expensive rate, one can get large incomes. It just seems that way.
Anyway, even the best exchanges today with the top security measures in place are not totally safe and can be compromised/hacked. It is possible to increase the trades efficiency utilizing specific trading bots& algorithms. They allow earning on a growing trend, in the falling and side markets. Fact is — it’s quite an exciting way for diligent people who are willing to engage in full-time monitoring of currency rates and fluctuations, spending 24/7 and researching trading strategies, but the numerous risks are present.
4. DeFi It
Decentralized Finance or DeFi has become one of the most prominent trends in crypto since late 2019. The sector has grown at a fast pace over the past six months and the DeFi assets market capitalization exceeded $ 1 billion and is not close to overcoming the $ 3 billion milestones! Most companies that operate in the blockchain field have already introduced their DeFi products. Popular DeFi protocols like Compound, Balancer, Curve, and other companies have opened up a door to a whole new world of crypto opportunities for investors looking for deep liquidity, varying risk-reward ratios, and interesting and affordable modern financial instruments. We’re about to see further adoption alongside the user base growth as institutional capital comes to the digital asset field.
5. Trust Management for Your Assets
If you are afraid to be not very efficient at trading, you can choose a professional manager on a specific resource who will invest your funds in cryptocurrency and make sure you earn on it. You can track the volume of the portfolio of the manager and what kind of profitability it brings to investors. The usual interest starts from 5%, and the entry threshold is low. However, there is also a minimum period of a few months when you can not withdraw the money invested. Summing up, we can say it’s a rather dangerous instrument with a high yield.
A Tough Choice?
Should you take your pick regarding a particular digital asset or create a crypto portfolio, a clear final goal must be taken into account. Even after crypto fever days of 2017, you can still earn money on crypto. However, you must be smart in your choice and don’t rule of investing: take your time to complete individual research, don’t put in the money you are afraid to lose, never try to engage questionable illicit Ponzi schemes and shady projects, keep calm and don’t put all the eggs in one basket.
