When people think of making money from cryptocurrencies, they typically imagine someone manically day-trading or constantly buying into new ICOs. Cryptocurrency has opened up a range of new ways to earn a little extra income. From day trading, investing in ICO’s, getting paid for micro jobs and so much more.
However many of these methods require a hands-on approach and takes time to be successful. Thankfully there are some methods that are more on the passive side and while the returns won’t be as high, it’s still a way to get some sort of income stream going.
These methods range from semi-passive, which require a small amount of time, to fully passive, which require no time at all. Depending on your available capital and willingness to sign up for things, certain methods may be better suited to your current investment capability and personal preferences.
For more ways to earn cryptocurrency check out my post – 22 Ways To Earn Cryptocurrency
Blockchains that use proof-of-stake (PoS) variants allow you to earn additional coins by staking your coins. In exchange for helping secure the network and locking up your capital, you receive a proportional amount of the coin’s inflation. There are many PoS coins that each differ in their implementation and rewards — this site provides a long list of all of them and links to their respective specifics.
A specific type of PoS is delegated proof-of-stake (DPoS), in which people vote for delegates, rather than directly staking as individuals. Staking rewards tend to be a bit higher in DPoS coins such as Ark and Lisk.
The amount of initial setup ranges between coins; some require you to set up a consistently-online node, whereas others, such as Ark, require only a one-time setup through a wallet. Node staking is often more lucrative than simpler methods, at the expense of being more time-consuming and requiring a larger amount to stake. Assuming you want a more passive method, Ark’s staking can provide ~10% return with virtually no setup besides owning coins and choosing a delegate.
While Ark and Lisk are pretty pricey to get involved in investors can look at coins like Cardano and Tron who are still in testnet phase, buying a large stake while the network is still not available and once it fully launches you’ll be able to stake your coins or create a masternode depending on the amount you invested.
Several exchanges such as Kucoin and COSS have tokens that allow you to receive a share of the fees collected by the exchange. Typically, a certain percent of the exchange’s collected fees are given back to token holders, and then within that portion, your received dividends are proportional to the number of tokens you hold.
This method is not necessarily very consistent, as it depends on exchange volume during a given period of time.
Some coins offer dividends in the form of other coins simply for holding the original coin. For example, NEO generates Gas, and Vechain will generate THOR. Typically, each unit of the original coin will generate some predetermined amount of the new coin.
These new coins are related to paying network fees, whereas the original coins can be thought of more as equity in the network. The rate of return on these methods is quite low (~3% for NEO’s Gas), but they require no work beyond owning the original coin, so it is a very passive, low-risk method of earning income.
Airdrops are the crypto analogue to free samples in the mall. Projects that are just starting out will oftentimes give out a small number of free tokens to verified people in order to spread the word about their project. Typically, new projects will provide free tokens upon community involvement or signing-up and provide some basic personal information.
Usually, the amount given out during airdrops is small in terms of fiat currency, but if you hold on to the tokens for an extended period of time and you picked a good project, these tokens can grow in value, making your airdropped amount worth a significant amount of money. Also, airdrops are usually very quick to qualify for, so it is easy to do multiple airdrops in a short amount of time. For more information, and an ongoing airdrop, check out an earlier article I wrote on this topic.
For more on Airdrops check out my review here
Many websites, such as popular exchanges like Coinbase, CoinDirect, Kucoin and Binance offer referral programs that pay you to draw new customers to their exchanges. For your average person, this method is probably not going to net you much income.
However, if you have a large audience through something like a popular blog or YouTube channel, referral links can be quite lucrative.
Loan coins have been hugely popular with investors and scammers alike. Projects like Bitconnect, Davorcoin, & Falcon coin have shown us the downside or rather a dark side of loan coins having exit scammed at a high point. Loan coins are an extremely high-risk way to invest your cryptocurrency in order to get high yield interest and requires plenty of research before you enter the market with any project.
One project that seems very promising is NEXO coin which is backed by credissimo. At the moment Nexo accepts both Bitcoin & ETH for secured loans. Once you have sent your BTC or ETH to Nexo you can then secure a loan with them. Your Loan limit will be based on the market value of the crypto assets in your Nexo Wallet. Additional credit is automatically and instantly available on the card upon appreciation of your crypto’s value so you don’t lose out on your upside.
When spending the credit line at any time you will only have to pay 16% APR on what you have used and not the full amount of credit provided to you. You will also be able to make repayments at any time. There is no minimum repayment value and you can repay your loan in either BTC, ETH or Nexo tokens, If you repay your loan using Nexo you will receive additional discounts on your interest rate.
NEXO Tokens are a safe haven as they provide passive income in the form of 30% of the company’s profits, distributed monthly to NEXO Token Holders.
NEXO Tokens offer additional utility features such as discounted interest rates on the Nexo Instant Crypto-backed Loans and are also accepted as collateral on the Nexo Platform.
You can invest in Steemit in various ways but if you want to earn a passive income without having to vote or post yourself silly you can simply delegate your STEEM POWER to a bot or other popular accounts. Simply create Steemit account, send some cryptocurrency to your account via blocktrades. Power up your account. I would say 500 STEEM would be a good place to start. Then find a bot via steembottracker.com or look for popular authors and delegate your STEEM POWER to them.
You will then receive a constant flow of curation rewards each day in STEEM POWER. You can use the STEEM POWER you receive to delegate to new authors and keep the cycle going or you can power down to liquid STEEM send them to an exchange and bank your returns.
Interest generating sites
There are sites available that accept your investment in Bitcoin and then use this cryptocurrency to run their ecosystem and will pay you daily interest in return for your investment. A gambling and faucet site like FreeBitcoin accepts a minimum investment of around $3 US and you can start earning interest. The current interest rate paid is 4.08%
All you need to do is maintain a balance of at least 30,000 satoshis (0.0003 BTC) in your FreeBitco.in account and we shall pay you compounded interest on your full balance every day. There is no lock-in period to earn interest (you start earning interest right from the first day!) and your balance can be withdrawn any time you wish.
You can treat your FreeBitco.in account like an instant-access savings account to hold your excess bitcoins and earn passive interest on your account balance every day. Note that you do not have access to your private key of this account similar to exchanges so you’ll need to be comfortable with someone else holding your Bitcoin.
This one may not be for everyone but if you already have a website that’s generating traffic you could opt to monetize that traffic with cryptocurrency alternatives to traditional ad platforms like Google Adsense.
Projects like KindAds and Affiliate Coin are looking to do just that, they are currently still in ICO phase with their platforms to launch at the end of 2018 or beginning of 2019.
Are you a passive income earner?
Have you made use of any passive cryptocurrency earning techniques? How have they worked out for you? Is it worthwhile? Or would your money be better spent day trading or hodling in coins?
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Disclaimer: This article should not be taken as, and is not intended to provide any investment advice and is for educational purposes only. As of the time posting the writers may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency as all investments contain risk.