The sharp rise in prices and 100-fold gains have received widespread attention from experts and influencers in the cryptocurrency community because they provide the hope of getting rich overnight.
In fact, these opportunities are rare. Not to mention, only a few traders actually manage to catch these waves and cash out in time to lock in life-changing funds.
Fortunately, sharp price increases are far from the only way for crypto investors to make money, and the recent rise of decentralized finance (DeFi), non-fungible tokens (NFT), and slow progress in mainstream crypto adoption provide a Nearly a steady stream of investment opportunities.
Let’s take a look at five different ways that cryptocurrency holders can easily make money without actually trading.
Staking rewards users for locking their tokens on the protocol as collateral for transaction verification, which is one of the best ways to get income from the assets held in the crypto-based investment portfolio.
In August, The Ethereum network will switch From the proof-of-work (PoW) consensus model to the proof-of-stake (POS) model, and ether (Ethereum) Holders of the Eth2 contract can obtain up to 5.83% of income.
Under this new PoS system, token holders actively participate in transaction verification by locking their coins in nodes on the network, and then these nodes compete for the opportunity to verify transactions, create new blocks, and get the following award.
According to data from Staking Rewards, holding 10 ETH currently earns 0.0075 ETH per week, which is worth $17.96 at the current price, and 0.3876 ETH per year, which is currently worth $933.69.
As more tokens are locked on the network, the percentage rate of return on ether drops, so the final return may change.
Taking all factors into consideration, regardless of market sentiment or performance, Staking provides one of the best low-risk opportunities. Regardless of market sentiment or performance, you can get a larger stack and also help support through transaction verification. The internet.
Borrow cryptocurrency for low-risk returns
The development of the DeFi sector has led to the development of a diversified crypto lending ecosystem. Users can deposit their cryptocurrency into various lending protocols in exchange for rewards for different assets such as basic tokens or Bitcoin (Bitcoin), Ethereum and various altcoins.
Aave is currently the top lending protocol. The platform uses its native token, MATIC, to provide revenue opportunities for tokens on the Ethereum and Polygon networks.
The figure above shows the top seven loan pools that can be obtained through the AAVE protocol on Polygon. The reward is paid by Wrapped MATIC (WMATIC). The current annual rate of return on deposits (APY) is 1.92%, and the estimated annual APY is 6.1%.
Other top lending agreements include Curve (CRV), Compound (COMP), MakerDAO (MKR) And Yearn.finance (YFI).
Lending provides another low-risk way to obtain considerable benefits through tokens that do not provide user-controlled rewards (such as staking) in bull and bear markets.
Earn fees and tokens by providing liquidity
Liquidity provision is one of the main components of the DeFi platform. Investors who choose to provide funds to emerging platforms will usually get a high percentage of mortgage returns and a certain percentage of fees incurred in pool transactions.
As shown in the figure above, providing liquidity to the Ether/USDC pool on QuickSwap will allow investors to receive a certain percentage of the total daily distribution of rewards of USD 23,098 and an annual fee of 33.81%.
Ideally, long-term investors are best to study the pool of funds available in the market, if the liquidity pair consists of reliable projects, or even a stable currency pair, such as USDC/Tether (USDT) Looks very attractive, it may become a blockchain version of savings accounts, and its rate of return is much higher than that currently found in any bank or traditional financial institution.
Maximize returns through high-yield agriculture
The concept of income farming is to operate encrypted assets in a way that produces the highest returns while minimizing risks.
With the emergence of new platforms and agreements, they provide depositors with high incentives as a way to tap liquidity and increase the total value (TVL) locked in the agreement.
Reward for STKGHST-WETH LP deposit on DinoSwap. Source: DinoSwap
The high income provided is usually paid in the platform’s native tokens, as shown above, where the user deposits liquidity pool tokens for the STKGHS-WETH pair, with an APR of 189.2%, and has generated 3.312 reward dino so far.
For long-term investors holding a portfolio of various tokens, income agriculture is a way to access new projects and obtain new tokens without spending new funds.
NFT and blockchain games make “play to make money” a reality
Blockchain games and NFT collection are another way to generate crypto portfolio returns without spending new funds.
Axie Infinity is currently the most popular example. The gameplay involves trading, fighting, collecting and breeding NFT-based creatures called Axies.
Playing Axie Infinity will generate rewards in the form of Smooth Love Potion (SLP), which is an in-game token used in the Axie breeding process and is also traded on major cryptocurrency exchanges. Users can exchange SLP for USD-based stablecoins or other large-cap cryptocurrencies.
According to the data of Your Crypto Library, “Today, the average player’s daily income is between 150 and 200 SLP.” According to the current market value, its value is between 40 and 53.50 US dollars.
In some parts of the world, this is equivalent to Income provided by full-time workFor this reason, Axie Infinity’s user activity and new accounts in countries such as Venezuela and Malaysia have increased significantly.
Compared with what traditional banks provide on savings and checking accounts, crypto investment, borrowing, betting, and gaming to earn blockchain games provide a higher return on investment. With the development of the blockchain industry, investors are likely to continue to flock to high-yield platforms to participate in the agreement.
Want to learn more about trading and investing in the crypto market?
The views and opinions expressed here only represent the views of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading action involves risk, and you should conduct your own research when making a decision.