How To Make Money On Cryptocurrency In 2024: 12 Ways And Tips

Shares of the Coinbase Global fund, which invests in various cryptocurrencies, grew by 129.79% from January 3, 2023 to October 23, 2023. This means that investors who bought Coinbase Global shares in January increased their capital twice in less than a year.

In this article, I will tell you what there are ways to earn money on cryptocurrency and how to prepare for cryptocurrency trading if you have not worked with it yet.

• What is a cryptocurrency
• What Ways to Ear in Earnings
• How much can you earn on cryptocurrency
• How much money is needed to start?
• How to Prepare for Cryptocurrency Trading
• How to learn how to make money on cryptocurrency

What is a cryptocurrency

Cryptocurrencies are virtual money that do not have a physical embodiment in coins or banknotes. Cryptocurrencies exist only in the form of data, but you can pay for their purchases on the Internet, invest in them and use them to store capital instead of deposits in the bank.

The cryptocurrency is created by individuals or companies. The issue of cryptocurrency is not controlled by the state. All transaction data is stored on the blockchain.

Blockchain technology for working with digital assets. It is organized as a registry or platform that stores transaction data. The information from the registry is distributed by the computers of all network participants and connected in the general chain of information blocks. Members of the network are all who use the blockchain platform.

There are two types of cryptocurrency: coins (coins) and tokens (digital assets). Technically, there is a difference between them, but in practice it is the same. Coin and token - cryptocurrencies, as one dollar.

Cryptocurrencies can be bought on crypto exchanges, such as Binance, HTX (formerly Huobi) or Bitpa, and stored on these exchanges or in crypto wallets. Crypto wallets - programs or services that allow you to make transactions with cryptocurrency.

What are the ways to earn money on cryptocurrency in 2024

There are two main ways to earn money on cryptocurrency. First: to earn, you need to buy cryptocurrency cheaper, and sell more expensive. Second is the mining of cryptocurrency: to make money, you need to create coins and sell them. I'll describe the 12 ways you may have heard of if you've studied this topic.

How to earn money on cryptocurrency trading

Cryptocurrency trading is divided into varieties such as trading, arbitration, copyraiding, holding, participation in tokens and NFT auctions.

Trading - earnings on the minimum changes in the price of cryptocurrencies. Traders buy cryptocurrency, wait for it to rise in price by a couple of percent, and sell. Most often, they earn money on cryptocurrency with the help of trading.

For example, the Dogecoin cryptocurrency exchange rate changes every minute. Traders can buy and sell it several times a day and earn on each transaction about 1-10% of the invested funds.

The holding is a long-term investment. Investors buy cryptocurrency for a few years to make money on its growth. On the holding you can earn as much as on trading, if not more, and time it needs to be less.

Not all cryptocurrencies are growing. But, if you find a promising cryptocurrency, you can increase capital several times. The most striking example is the growth of Bitcoin. Since 2012, the price of cryptocurrency has increased by 670,625%.

Arbitration of cryptocurrencies is a type of trading, when cryptocurrency is bought on one exchange cheaper and sold on another more expensive. There are always small differences in prices on exchanges. There are special arbitrage scanners to find these differences. For example, Arbitrage Scanner, P2P.Army. OKX has its own arbitration bot.

On popular exchanges and in popular pairs, the difference is small - sometimes a fraction of a percentage. The pair is two assets that can be exchanged for each other on the stock exchange. For example, two cryptocurrencies or cryptocurrency and dollars. To get one cryptocurrency from a pair, you need to give another. For example, there is a pair of BTC/USD: to get bitcoins, you need to give dollars, and vice versa.

In less traded pairs or on exchanges with less activity, the exchange rate difference may be significant. For example, the profit from one "circle" exchange is able to reach 10-20 dollars. You can earn that money in 5-10 minutes.

Part of the profit from the arbitration will go to the commissions. Therefore, it is better to start arbitration with capital from thousands of dollars. The commission will be less palpable.

Copying on the crypto market is another type of trading, copying transactions of an experienced market participant. An experienced player registers as an "Ald-trader" (master) and trades. Other members can subscribe to a lead trader, and all of his trades will be automatically copied to their accounts.

Copytrading is available on Binance, Bybit, OKX, Bitget, BingX and others. You can connect to the strategies directly on the exchanges. There are also separate platforms - for example, TraderWagon, a partner of the largest exchange Binance. On the platform you can see the strategies of traders and join them on Binance.

Participation in the tokens is the purchase of coins of a new blockchain startup before they become available to everyone. There are different mechanisms of token-sales:

• ICO, or initial placement of tokens: the startup issues and sells tokens, which can then pay for its services. The ICO boom was in 2017, now this method is outdated, it was replaced by IEO and IDO.
• IEO, or primary exchange offer: a startup goes to the centralized exchange and sells tokens at a minimum cost.
• IDO, or initial decentralized offer: a startup raises funds on a decentralized exchange. He goes on the stock exchange and sells coins almost simultaneously.

The purpose of participation in the tokens is to get coins at a minimum cost, and then, when they rise in price, sell.

You can track token-seila on startup sites, on crypto exchanges and on special platforms. Special platforms are several, the most popular is CoinList.

NFT auctions. I took this way to trading cryptocurrencies because technically people make a profit through the sale of NFT. But in fact, earnings on the NFT are a separate large direction, which has little to do with cryptocurrency trading.

NFT is a technology that enshrines the right to own a digital object behind one owner. NFT tokens are unique records on the blockchain that have information about the owner. In the form of tokens, paintings, memes, songs, photos, virtual collections and much more are produced - almost anything.

NFTs earn by creating and selling their NFTs or reselling the NFT for which there is a demand.

How to earn on cryptocurrency mining

In this section I will talk about the mining of cryptocurrency. It can be created or obtained, and then sold and earned on it. The coin that has been a coin that is mining is a coin that has been banned in China, Iceland, Kosovo and other countries because it consumes a lot of electricity and harms the environment. Also, cryptocurrency is obtained with the help of so-called faucets and airdrops.

Mining is the production of a new cryptocurrency at the expense of the equipment capacity. To collect a new block of data in the blockchain and write down information about transactions, you need to solve a mathematical problem. The one whose equipment will solve the problem first, receives a reward - new coins and a commission for transactions, the data about which are in the new block. You can read more about the process on the Binance Academy website.

For mining use expensive equipment: ASIC miners, rigs and farms. You can also use powerful personal computers, but it is unprofitable - mining on them almost does not pay off.

You can not mine all cryptocurrencies, but only those that work on the principle of Proof-of-work. Proof-of-work (PoW) is a mechanism that requires complex mathematical tasks to verify and record transactions on the blockchain. For example, PoW is powered by Bitcoin, Ethereum Classic, Dogecoin, Litecoin, Monero.

Cloud mining - rental of capacities for mining. For cloud mining, you do not need to buy equipment and pay for electricity. All this is done by a special company that is handing over its capacity to the tenant. For example, on the Binance exchange, rent costs from $5.76, and on BeMine - from $36.85 per month.

Both on mining and on cloud mining, you can not earn money, but lose. It happens that the created cryptocurrency is not enough to pay for the rental of capacity or it does not pay off the cost of buying equipment and paying for electricity.

Faucets are sites that give out cryptocurrency for actions, for example, for entering captches. It's worth a little bit of work. Usually, 1-5 mate is paid for one action.

Satoshi is a hundred millionth of Bitcoin. 1 satoshi costs 0.00000001 bitcoin, or $0.000630 USD. It turns out that faucets pay several kopecks for one action. Therefore, at least the average salary in India is unrealistic to earn on them.

Faucets are available on special sites - for example, FreeBitcoin, Wedex, Free-Doge. On the Free-Doge exchange, you need to enter a captcha, and the service will issue the code participating in the draw. The draws take place every hour. Most of the codes receive a payout of several kopecks, four people - three dollars, two - thirty dollars, and only one participant receives $300.

Airdrop is an action when a blockchain project or platform is distributed to cryptocurrency for free when the agreed conditions are met. For example, for a subscription or transaction on the platform.

Such actions are carried out to increase the recognition of the site and attract new investors. To search for current drops, you can use special services - for example, Airdrops. But airdrops are rarely carried out, and resources or cryptocurrency are sometimes needed to fulfill the agreed conditions, so it will not work much to earn much either.

How to get passive income from cryptocurrency

You can invest money in cryptocurrencies once and constantly receive income. There are two mechanisms of investment: landing and steking.

Landing is an investment of cryptocurrencies at interest. The investor buys cryptocurrency and leases it to the crypto exchange. Crypto exchange earns on this cryptocurrency, and the investor receives a percentage for the landing page. Each exchange has its own percentage, most often it is 1 -5% per annum.

You can give money in rent not only to exchanges, but also to other users, and special landing platforms. But working with crypto exchanges is easiest - usually more cryptocurrencies and higher interest rates are available on them.

Steaking is the freezing of cryptocurrency to support the blockchain. This is a kind of deposit - the investor keeps the coins on a special account and receives interest for it. The more assets are frozen, the more income will be.

Steaking can not be used with all cryptocurrencies, but only with those that work on Proof-of-stake. Proof-of-stake (PoS) is an algorithm by the rules that, in order to add new blocks to the blockchain and confirm transactions, you need to own network tokens and block them for a certain period of time. Cryptocurrencies operating on PoS include, for example, EOS, Tezos, Tron, Cosmos.

Steaking is available on all exchanges, but on each exchange its own tariffs. For example, on Binance you can open perpetual steaking under 0.79% or higher. Or an urgent - on 30, 60, 90 or 120 days.

How much can you earn on cryptocurrency

It all depends on the way you earn and invest in it. If it is not possible to earn 500 dollars per month on the faucets, then on arbitration and trading you can earn 5000 dollars per month. And this is not a coincidence: a Coinbase survey showed that in 2022, 62% of investors increased capital through investing in cryptocurrency. I'll talk about two examples and show my deals.

Mike lives in Bali and is engaged in cryptocurrency arbitration. Its capital is about 200 thousand dollars. He believes that for the year you can earn 150% to the capital - that is, to increase it by one and a half times. One day, when the tenge rate fell, Mike earned 2 thousand dollars for 4 hours.

On July 13, 2020, an unknown trader earned $500,000 in half an hour on the token sale. When the BZRX cryptocurrency was placed on the exchange, the trader attacked the coin network and others could not buy it immediately. The trader bought almost 2 million coins, and then sold them at an inflated price.

I make money on cryptocurrency trading. Sometimes this can bring a good income - for example, the cost of bitcoin from January 1, 2023 to September 21 of the same year increased by 62.23%. In less than a year, capital could be increased by half.

In 2021, I had two major successful deals. I earned $4,000 on the Launchpad FC Porto Fan Token, and on the Launchpad Voxies, $10,000.

Cryptocurrencies have high volatility - their cost can change every minute by tens of percent. This is because most cryptocurrencies are not backed up. The prices for them depend only on demand and demand. Therefore, investments in them are risky - invested money can be lost.

There are other risks in the money on cryptocurrency. There are many scammers, pyramids and hackers on the cryptocurrency market that can steal money. In the first half of 2023 alone, hackers stole cryptocurrencies worth $497.73 million.

How much money you need to start making money on cryptocurrency trading

You can start with any amount - at least from 1 dollar. I recommend starting with small amounts that are not a pity to lose.

What can I invest a conditional 1 dollar in? You can buy not an entire coin, but a share of it. For example, on the Binance exchange for 1 dollar you can buy 0.00001 bitcoins. There are similar opportunities on other crypto exchanges.

You can also connect the car investment (dollar cost averaging, DCA). This is a regular purchase of the cryptocurrency for the established amounts - for the same hundred dollars per month. This possibility is not available on all crypto exchanges, but on many - for example, on Binance, Bybit, OKX.

You can adjust the car investment by specifying these parameters:

• which coins to buy (one or a few);
• for what amount;
• for which currencies (for ordinary money or other cryptocurrencies);
• with what frequency (from 1 hour to 1 month).

Once you've run your DCA strategy, you'll be constantly averaged, buying cryptocurrency at its current cost.

Of course, you can start with a capital of several million dollars. But I recommend moving to large amounts only after you study the cryptocurrency market and start making a steady profit from trades.

How to Prepare for Cryptocurrency Trading

To trade crypto, you need to have a crypto wallet, choose a crypto exchange and make a strategy.

You can start a crypto wallet on the sites Trust Wallet, Metamask. Wallets on them are non-castodic - they are in the form of programs on a PC, applications on a smartphone or online service. You can also have custodial wallets: this means that the owner's data is stored at the third party - custodian.

Crypto exchanges are many, the most popular - Binance, Coinbase Exchange, Kraken.

When choosing a exchange, pay attention to the size of the commission, ways to replenish and withdraw money. Also study the functionality of the exchange - whether it is possible to earn the chosen way.

Impulsive deals will help avoid strategy. It needs to describe what cryptocurrencies you use when you enter into trades and exit them. For example, a strategy can be this: every month to buy the set number of coins regardless of the price. Or buy cryptocurrency when it lost 20% of the value per day, and sell when it rose by 5%.

The strategy can be adjusted depending on the situation.

The main thing is to diversify the investment. Diversification is a strategy in which resources are invested in different assets. You need to diversify everything from the coins you invest in to the services used and wallets. If you buy only one coin, you can lose money in its collapse. If you keep money in one wallet, the risk of losing them due to hacking will be higher than if you store them in different wallets.

How to learn how to make money on cryptocurrency

Trading cryptocurrency is not taught in universities. You can learn this on your own or in special courses.

You can independently study the crypto market with the help of platforms or forums. For example, cryptocurrency is written on Bybit and OKX. The main advantage of self-study is free. Less information is not systematized, which increases the risk of making a mistake.

The courses are paid, but the information in them is systematized. The main advantage of the courses - they give knowledge of how to avoid mistakes. If the course has a good program, already during the training on it you can make a good strategy for investing in cryptocurrency.