Top 3 Ways To Make Passive Income With Crypto

Table of Contents

Introduction

The cryptocurrency market is currently in a bearish trend. The bear market has been in play for more than a year now, with prices of most down by more than 60% from their all-time highs. 

Despite the bear market, some investors continue to make money in the cryptocurrency space. There are various activities you can do to earn money in the crypto space. However, we will look at the top three ways to make passive income with crypto. 

Earn Passive Income With Crypto Using These Three Methods

1. Yield farming

The first option we are going to discuss is yield farming. Yield farming is also known as liquid staking and involves lending your crypto to others and in return, receive some rewards or interest. 

As a yield farmer on decentralized exchanges like Pancakeswap, you will be required to deposit a certain number of coins into a liquidity pool and earn income from transaction fees. In addition to that, you will also be required to stake  a group coin, named LP token, which allows you to invest and receive yield farming profits payable in the platform’s token. 

Keep in mind that as a yield farmer, you will need to lock up your cryptocurrency for a while to earn interest. You can access yield farming opportunities on various protocols like Uniswap, Pancakeswap, Aave, Compound, Curve Finance, and a few others. 

2. Ethereum Staking

The Ethereum network migrated to a proof-of-stake mechanism a few months ago, which means that investors can stake their ETH and earn passive income in the process. Ethereum staking is an excellent way to earn passive income thanks to the fact that Ethereum is currently the second-largest cryptocurrency by market cap.

If you wish to stake your Ether coins, you must have at least 32 ETH staked to become a validator. This is tough to do unless you are a seasoned crypto enthusiast. There are other ways to stake your ETH coins without allocating such a huge amount.

Validators on the Ethereum network allow smaller ETH holders to assign their tokens to them and earn part of their staking rewards. You can easily stake your ETH tokens using any of these three ways;

  • Centralized exchanges: Some of the leading centralized exchanges allow you to stake your ETH coins.  
  • Staking pool: They allow you to stake your ETH coins and earn passive income from the trading fees generated.
  • Node: This is the most complicated one as it involves you operating your validator node on the Ethereum network. This is reserved for those who own 32 ETH coins and can stake them. Furthermore, you will need a powerful computer to help you run transactions while constantly connected online.

3. Cloud Mining

Another excellent way to make passive income with crypto is via cloud mining. Cloud mining involves the mining of cryptocurrencies using ented cloud computing power. This means that you can mine cryptocurrencies without owning or directly running any specialized software or gremotely by registering an account and paying a small feeear. As an individual, you can participate in cryptocurrency mining. We already have cloud mining service providers like Genesis Mining and HashNest that charge daily service fee on their cloud drilling rights. With cloud mining, crypto investors have a chance to earn passive income. 

Final Thoughts

The cryptocurrency market continues to generate opportunities for traders and investors every day. However, the above-explained are the three best ways you can earn passive income with crypto.

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