It's remarkable that so few business owners have realised the advantages of cryptocurrencies. Like any industries, there are risks, but the potential for profit is far greater than in traditional finance.
Although there is a lot of technical jargon used in the cryptocurrency sector, many of the fundamental ideas are the same as those in traditional banking; they just go by different names. The phrases "Web3," "DeFi," "cryptocurrency," and "blockchain" are essentially interchangeable.
Here are five quick ways to learn about cryptocurrencies and put your money to work for you as effectively as possible.
- Direct investment
Combining traditional and modern finance is acceptable. A wonderful approach to make money is to invest in a variety of crypto assets and then sit back and wait, especially if you have experience and a taste for the fixed-income market.
The cryptocurrency and broader decentralised financial markets enjoy great compound annual growth rates on a yearly basis, better than perhaps any other market, despite ups and downs.
In other words, the returns of a cryptocurrency portfolio could be very profitable if you operate on three to five-year time horizons. You can also invest in a mixture of riskier tokens and safer coins. In the area of cryptocurrencies, there is a tonne of space for innovation. In this market, investing is known as "HODLing."
- Starting a business
The most lucrative sectors are frequently those that develop alongside new industries. Merchants engaged in side businesses (shovels, boots, alcohol, lodging) made the most money during the California Gold Rush in the 19th century.
The emergence of a new internet might be compared to the bitcoin market. Legal counsel, public relations, marketing, instructional materials, blockchain engineers, networking experts, content writers, social media gurus, portfolio managers, human resources, talent acquisition, affiliate marketing, and more are all required.
- First financial investment
The most successful business people in the world rarely decide to launch a new venture. They ultimately make investments in companies that have the potential to produce a sizable return with reasonable risk levels. Entrepreneurs with extra cash may favour new firms with a high chance of success.
Those who invested in particular ventures early on have seen the greatest profits from cryptocurrencies. From 2020 to 2021, MATIC, a Polygon token, increased from $0.015 to $2.45. The price has increased by nearly 50 times to about $0.75.
- Staking
The majority of cryptocurrencies, including Ethereum, Cardano, Binance, and Solana, support crypto staking. Staking cryptocurrency is analogous to getting interest on a bank deposit account. The distinction is that you keep ownership of your assets and that the interest rate usually ranges from 4% to 8%.
Thus earning money is extremely simple and easy using this method. You only get the interest when your money is locked up; the money has to be stashed away in order to get the interest. There is still risk involved. Nonetheless, this danger is quite low. It is doubtful that the more established blockchains (such those described above) would disappear. They are too strong, and generally speaking, your investment is secure.
- Staking of liquids
Another approach to earn money with cryptocurrencies is through liquid staking. Ankr, a Web3 infrastructure company, created Liquid Staking, which is a game-changer in many ways. The staked tokens can earn interest for users, but they are not locked up. A derivative token is used to do this.
In other words, Ankr and other companies are bringing the derivative market into the bitcoin space. The derivative token may be applied to trading, lending, yield farming, and other forms of investing. It can be put to use twice. You might be able to receive a guaranteed 4%–8% and then lend the derivative token out for an additional 4%–12%.
Of course, the market for these derivative tokens is not yet established, and it is by no means error-free. All markets have risk, and this is not investment advice. Yet, the argument is made that liquid staking offers innovative strategies for profit maximisation that ought to interest the curiosity of risk-averse businesspeople.
Bringing everything together
Cryptocurrency offers a variety of ways to make money, and a lot of it depends on your tastes and skill set. The abundance of options in the cryptocurrency market makes it difficult to concentrate and stick to a specific investment strategy.
But ultimately, the enduring ideas still hold true. Maintain your course and see your plans through to completion.
Avoid grabbing hold of every chance you see because doing so will cause you to be divided among too many different initiatives.
Be selective with your investments and avoid taking on more than you can handle. Simple crypto staking gives good benefits even on its own. Because to excessive greed and bad investment psychology, many investors are still losing money on Web3. Throughout all markets, separating the wheat from the chaff is a crucial investment principle.