As soon as investors buy Bitcoin on paybis, they have only one thought – how to increase the value of their portfolio. Making money with cryptocurrency is very popular these days and the possibilities are increasing.
In this article, we will introduce our favorite methods and help you discover how you can also make money with Bitcoin. After reading this post, you will have an overview of all the financial services you can deploy to grow your portfolio.
Method #1 – Bet
One of the most popular ways to make money with Bitcoin is by investing. In a nutshell, staking refers to the process of “locking in” your funds, rendering them unavailable for a short period of time. By investing it, you earn interest in the form of the same (or different) cryptocurrency, which is then credited to your account.
There are two different types of bets:
- Exchange staking – staking service that can be implemented for multiple cryptocurrencies operating on the basis of PoS consensus. Exchange platforms distribute rewards to individual coin holders, and the barrier to entry is usually very low.
- Invest in your wallet – This process is more “old school” and depends on the mechanics of the particular blockchain. Users invest their coins in any supported wallet and automatically receive rewards depending on the size of their holdings. For example, users who invest NEO in their wallet will receive GAS coins as a reward. Please note that for some coins, their minimum stake size is much higher than when investing in exchanges.
Method #2 – High-interest savings account
Savings accounts are popular in 2018-2019. as popular exchanges began to offer more cost-effective alternatives to bank accounts. The annual rate of return depends on the cryptocurrency invested and is known to be at least 10 times higher than if you deposit it in a bank account.
To give a brief example, Blockchain Wallet currently offers savings accounts that yield an average of 5% APY for Bitcoin and up to 12% APY for stablecoins.
This is the least risky way to increase the value of your portfolio and the way many high net worth investors use to generate passive income.
Method #3 – Trading
Trading is clearly the most popular way to (potentially) profit from your Bitcoins. Users trade crypto pairs on exchanges in the hope of outperforming the market and thereby increasing the value of their portfolios.
In general, there are two types of traders:
- Swing Traders – These traders make decisions based on charts and price indicators and often use leverage to increase profits. This strategy is considered useful for short-term traders and is largely based on technical analysis (TA).
- Sentiment Traders – These people make trading decisions based on the overall popularity and “feel” of the entire market. Often referred to as intermediate traders, they will make up a small number of traders every year, usually when there is a change in market cycles or during important events that affect the markets. Sentiment traders use sentiment analysis (SA) to make their decisions.
The above possibilities are then broken down into several subsections, making trading a very broad and complex subject that requires both education and ongoing practice. Even then, only a small percentage of traders end up being profitable in the long run.
Method #4 – HODLing
“HODL” comes from the word “hold” and is an acronym commonly used by cryptocurrency investors to explain the long-term investment process. In other words, HODLers are those who don’t sell their coins when the market fluctuates, but prefer to keep their coins stored in wallets because of their unwavering belief in their fundamentals.
Bitcoin is usually the most HODLed coin and those who have controlled their emotions and haven’t sold for years are now being well rewarded. Obviously, this process comes with a lot of anxiety when the markets are very volatile – however, those who have been through this process long enough are now immune to such feelings.
To make money buying Bitcoin through HODLing, it is important to study the basics of the coin. As for Bitcoin, this will be Satoshi Nakamoto’s 9-page white paper, describing Bitcoin’s underlying technology and its future potential.
Terminate
You should now have a better idea of all the different methods you can use to increase the value of your portfolio. In a nutshell, here are the methods we looked at:
- Put Bitcoin on an exchange or wallet (works with other cryptocurrencies too)
- A high-interest savings account that offers returns at least 10 times that of the average bank.
- Trade your money, either through swing trading or practicing emotional trading.
HODL your Bitcoin for the long term and study its fundamentals. This is the least risky and most profitable option you can choose.
Categories: How to
Source: newstars.edu.vn