There are a plethora of different ways to earn Bitcoin and not all of them involve being a technical analyst, expert trader or genius wonder kid. It certainly helps but it doesn't mean you can't make good money and earn more Bitcoins by investing in cryptocurrencies and exploring several other areas that can lead to growing your crypto wallets until they are bulging.
Buying & HODLing
One of the most true and tested ways people have made money in cryptocurrency is to simply invest some money and then "hold on for dear life". If you look at the Bitcoin charts it's easy to see that the best way to have made money was to buy and then do nothing but wait it out.
This strategy evades most due to panic selling and people getting too emotional about those gains they just made that they might sell at the first opportunity feeling like a champion only to watch the price more than double a month later.
Learn from those that sold Bitcoin and other cryptocurrencies years ago and HODL!
Of course, most people associate making money in cryptocurrencies with trading. While this is a great way to make more money in crypto it does involve a lot of self-education first to understand the basics of technical and fundamental analysis and so isn't for everyone.
Also if you opt to day trade you could find this takes up literally all of your time and involves you waking up at crazy hours of the night to make that quick trade when people on the opposite side of the planet are waking up.
While trading can offer life-changing returns it's not for the faint-hearted and certainly not the only option available to the crypto beginner.
Here is our guide for beginners trading on Bittrex, one of the most popular exchanges in the western world alongside Binance and GDAX.
Most important takeaways? Buy Low Sell High! Obviously! avoid FOMO, FUD and carry on.
Investing in ICO's
Investing in ICO's is high-risk high return but with the right due diligence and following a good strategy to pick out the good ICO's from the scam coins, you can leverage the odds of success in your favor.
ICO's have become all the rage over the past year since the Ethereum network allows them an easy platform to pre-sell ERC-20 tokens and has become the fundraising mechanism of choice for most new companies looking to get involved with blockchain technology.
Unfortunately, unscrupulous individuals have also entered the mix giving a bad name to the initial coin offering and making investors more wary of putting their money in. This is a natural progression since anything that is lucrative will always bring in a certain amount of scammers and other criminal activity.
On the flipside, if you look at sites like ICOStats you can see some of the crazy returns that are possible if you invest in the right project at ICO stage. NXT currently shows an ROI from ICO price of +3995954%! Not too shabby at all!
In the last 12 months, ICO's have been one of the best ways to earn Bitcoin. Read our beginners guide to researching and buying ICOs here.
Mining / Proof of Work
Miners are an integral part of any coins that follow the proof of work protocol. Bitcoin, Litecoin, and Ethereum are all examples of this, however, the latter of the three is working towards shifting toward the main alternative known as Proof of Stake. We will talk about that later.
For now let's stick to Proof of Work, which is the process of having people mine your coins on the blockchain. This involves a complicated puzzle solving process that has two purposes for the blockchain.
- It allows transactions to be confirmed on the blockchain
- It secures the blockchain and makes it unhackable and temper proof by decentralizing it across thousands of different computers. To hack Bitcoin you would need the resources to hack every single full note on the network. A full node is a computer that has the entire blockchain downloaded to it.
So why would you do this? Well as a way of saying thank you to all miners for their contribution to the blockchain, miners are rewarded with coins for their hard "work". Now you see why it is called "Proof of Work". Mining just an easy way to describe it and give those participants a role and name.
Bitcoin may not be affordable to mine in most countries these days but there are lots of up and coming coins that are still profitable if you have low enough energy costs and the equipment.
So we already discussed Proof of Work, the alternative protocol is known as Proof of Stake and is a little easier to explain.
Instead of people mining a particular cryptocurrency they can instead stake the coin. This means they have to download a desktop wallet and then after buying a certain amount of coins they have to be held in the wallet with the wallet on a running computer connected to the internet 247 so it can interact with the blockchain.
The result is these participants are securing the blockchain and also stabilizing the price by committing to not selling their coins since you can't sell coins if you want to earn the staking rewards that get paid out.
Proof of Stake may offer a lower return than other approaches to generating income and it may require you have a certain number of coins to make it worthwhile but it's easy to do for a beginner in the field and is low risk.
Some coins pay you in a special dividend token, an example of this is NEO, which pays in the form of something called Gas. If you do the maths on this, NEO gives you 0.33 Gas per year, but if the NEO/Gas price goes up 3X you will get back around 80% of your initial amount in a year. So this is a slow and steady way to earn more Bitcoin by selling your staking profits and converting them into Bitcoin.
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Running a Master Node
Okay so now we take things a step further. Running a master node is a more advanced form of staking that some Proof of Stake blockchains support. Master Nodes vary in their requirements but typically involve you having 10,000 or more coins staking in your master node wallet. This is just a wallet stored on a computer or VPS with a dedicated IP that has 247 uptime.
Running a Master Node also offers you additional privileges like a vote on decisions with the future of the coin and where the budget is being spent, as a reward for holding more coins and having more involvement Master Nodes earn a higher amount of the block reward.
Take DASH, for example, a Master Node would have cost only $25,000 not that long ago in 2015, and by the end of 2017 the value was around $800,000, a pretty solid way to earn Bitcoin by selling your Dash Master Node after only holding it for two years.
Sell your Products or Services / Freelancing to Earn Bitcoin
If you have a website or a brick and mortar business why not switch to accepting Bitcoin and other cryptocurrencies that are more convenient for microtransactions like Litecoin. This is a no-brainer way to earn Bitcoin without buying it and it's very easy these days to set up a Bitcoin payment gateway on your Shopify or WooCommerce eCommerce website and begin accepting BTC in under an hour.
If you use Shopify then you can use one of their built-in apps to allow you to accept Bitcoin, Litecoin and others. If you are a WooCommerce user then you have a few choices but the GoURL Bitcoin plugin seems the best and supports several alt coins in addition to Bitcoin.
Ethlance is a freelancer website that allows you to pay or get paid in Ethereum and is probably a trend you will see a lot more of over the course of this year with freelancer specific tokens being launched this is likely to be a big market as a freelancer myself I can see many problems this solves as the freelancer websites at the moment take large cuts from freelancers for the work they do and the transfer fees of using Paypal for micro tasks eats away into the profits.
Becoming an Expert in the Field
Why not become an expert or educator in the field of blockchain technology, decentralization and cryptocurrencies? Sure it won't happen overnight but you can start by documenting your experiences for other newbies because once you learn 10% of a subject you are already a relative expert to those coming after you. That said always advise people to do their own homework as we do here because you can't trust any one persons opinion on the internet and that is a fact!
Becoming a developer in blockchain and cryptocurrency projects. A lucrative job where there is currently less competition given the industry is still in its infancy.
If you already know a programming language then the barrier to entry will be far lower and this could be a great way to learn the code that is going to shape the future.
Consider learning Solidity, the language behind the Ethereum Smart Contract technology. We have written an article covering the various courses you can enroll on if you want to learn blockchain programming.
Be a Commentator / Expert - Another way to use your expertise and what you have learned about Bitcoin, Blockchain and cryptocurrencies are to become a commentator.
Depending on your talents and tastes this could lead to you writing for magazines and websites on the topic if writing is your thing or if you are interested in the video space you could set up a YouTube channel to talk about crypto, share your experiences and help to educate others in the space.
This could lead to you speaking at blockchain conferences and events, offering Bitcoin consultancy services and more.
Both of the above can be very lucrative if you really do your research and have a strong passion for decentralization and all of the other benefits that Bitcoin and the blockchain technology have brought us so far.
Blogging or Vlogging
Another fantastic way to earn money in Crypto that has been around for a while but is being disrupted by projects like Steemit, which is a website that works a bit like Reddit and Medium and allows anybody to publish articles about pretty much anything.
However there's a difference, instead of the website owners earning money from their users and contributors, this money is rewarded back to the people creating and curating content in the form of their own cryptocurrencies Steem and Steem Blockchain Dollars based and it is divided based on your activity and engagement including upvotes and resteems (the Steemit equivelent of a Retweet). Some users have been making hundreds and even thousands of USD equivalent per post which is mind-blowing.
If creating video content comes more naturally than writing, check out D.Tube, the video hosting website built on the Steemit blockchain that is like merging Steemit and YouTube together.
There is so much happening in this space it is hard to say for sure what the future holds and what new possibilities to earn money in crypto will become available over the next year or so.
There are a few areas that I am pretty interested in and think will form new opportunities very soon if they aren't already that include Virtual Reality and projects like Decentraland where people are already buying virtual land with the intention of building virtual businesses that will include eCommerce, gambling, gaming, social experiences, cryptocurrency trading in VR and much more.
If you thought Crypto Kitties was big then imagine crypto collectibles in Virtual Reality! This is another feature of Decentraland and something I can see being very popular as their ecosystem evolves. There will be jobs for developers, designers, moderators, entrepreneurs that want to start a new virtual business and many others.
Going back to Steemit, they are also launching something called Smart Media Tokens (SMT) that will empower publishers to create their own digital assets or tokens and use them to monetize their own website with cryptocurrency which is absolutely genius.
If you have any other suggestions on how you can earn Bitcoin then please let us know by getting in touch.