How Do Cryptocurrencies Like Bitcoin Make Money
No doubt you’ve heard about cryptocurrency – the alternative to government controlled cold hard cash (fiat) that’s changing the way we view money in general. Crypto is short for the cryptography that is used to secure, and verify, the creation of more ‘currency’. It also secures and verifies all transactions made with the currency. In other words, cryptocurrency is ‘cryptographically’ produced and controlled money.
Whilst most of us who have grown up with ‘cold hard cash’ may find it difficult to get our heads around the concept of a currency with no coins or notes, the fact is that cryptocurrencies, and there are a number of them now, look like they’re here to stay. They’re making a big splash on the investment scene too!
Can You Really Make Money From Bitcoin And Other Cryptocurrencies?
- The answer to the question ‘can you really make money from bitcoin?’ is yes. There are many people very successfully making a lot of money in the crypto sphere. Here are some popular ways of doing it:
- Hodling – buying and holding onto cryptos until they reach a price that allows you to make a profit from selling them
- Day trading – similar to hodling except that you buy and sell daily
- Cryptocurrency investing for dividends – again, similar to hodling with a significant difference; you buy into a currency and earn dividends on your investment rather than selling outright
- Cryptocurrency staking – the name for a crypto ‘term deposit’; buy coins and hold in a live wallet for a set term to earn more coins and/or a dividend.
- Cryptocurrency arbitrage – buying at one price and selling simultaneously for a better price at another exchange
- Cryptocurrency lending – as the name suggests, you lend coins to other investors to earn interest
There Are Risks But Living Has Risks Too
Whilst investing in cryptocurrencies can be amazingly profitable, there are definitely risks associated with investing in anything that’s not regulated and not under the control of government and financial authorities. Scams abound, and hacking thieves who prey on unsuspecting crypto owners with unsecured wallets are many. The crypto trading market is also very volatile with enormous peaks and crashes that can wipe out your entire holding at once. However, most solid cryptos also regain lost ground pretty quickly too and often go on to reach even higher peaks.
The Robert Downey bitcoin revolution trading platform is one way beginners to cryptocurrency trading are getting off to a good start! The platform’s built in trading algorithm not only helps make well-informed trading decisions but also gets smarter the more trades it does. As always, with all betting and gambling – don’t invest more than you can afford to lose.