How to Make Your Crypto Funds Work for You
Over the last decade or so, cryptocurrencies have ballooned in popularity and availability. From just a handful of available options a few years ago, those interested in entering the crypto market now have literally thousands of different currencies to choose from. While the price of these commodities remains highly volatile, many people have made impressive returns on their investment already.
Of course, making your money work for you is just smart financial practice for anyone and with any currency, including all fiat ones. So how can you apply the same principles to crypto? These helpful ideas could point you in the right direction to maximizing your capital and even potentially generating a stream of passive income, all of which adds up to a healthier bank balance for you.
Perhaps the most popular way to earn money from cryptocurrencies is through trading them. As with any form of stocks and shares – or Forex currency trading for that matter – it’s essential to familiarize yourself with the market and ensure you understand the repercussions of your decisions.
For this reason, it’s advisable to only ever trade a percentage of your crypto portfolio, so that if a strategy doesn’t pay off, you’re not left completely out of pocket. However, studying the market meticulously – or following the examples set by tipsters and professional traders – can yield significant dividends.
No, that’s not a typo – the term “hodling” first surfaced in 2013 when an allegedly inebriated cryptocurrency user proclaimed to the world that he intended to “hodl” his Bitcoin assets. This, despite the fact that the currency was currently experiencing one of the worst crashes of its short history.
Since then, the term has taken on the acronymized meaning of “holding on for dear life” – and the intervening years have certainly shown that the investor was right to do so. Although Bitcoin is highly volatile and has plunged in value on several occasions over its lifetime, it has bounced back to reward determined investors time and time again.
Earning interest by loaning funds to other individuals or organizations is something that’s normally reserved exclusively for banks, loan companies and other financial institutions. At least, that’s the state of play for fiat currencies, but disrupting that status quo is just one of many aims of decentralized finance (DeFi) and cryptocurrencies.
By signing up to a dedicated cryptocurrency marketplace and selecting the parameters of how much you want to lend and at what rates, you can start earning interest on your crypto balance almost immediately. This kind of passive income is growing in popularity due to its steady and reliable nature – and the fact that minimal effort is required on the part of the lender.
Anyone with any amount of wealth to their name will know that making your money work for you is instrumental in maximizing your income and taking your earnings to the next level – and the same is true for cryptocurrencies. Why not try your hand at one of these three forms of generating crypto income yourself?
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