Cryptocurrencies bursted into the mainstream last after Bitcoin’s incredible rise to a $20,000 trading price. The impressive bull run of Bitcoin also lifted the boats of all the other cryptocurrencies in the market – causing crypto assets to outperform traditional assets such as stocks, precious metals, and real estate. This year however, the cryptocurrency market has suffered steep losses and many people have started to wonder if Bitcoin and cryptocurrencies are another passing fad.
The truth however is that cryptocurrency is here to stay despite the criticism it faces from traditional financial institutions. The digital revolution and the digitalization of concepts have caused massive paradigm shift across different industries — the digitalization of money is long over due and cryptocurrencies are a credible solution. However, many people think that the only way to profit from cryptocurrencies is to trade on platforms like Binance. In addition to trading cryptocurrencies, this piece provides insights on how you can strategically position yourself on the value chain for the future of money.
- Buy and Hodling for the long term
Buying and hodling cryptocurrencies for the long-term is different from day trading. Holding long term positions requires you to do some work in fundamental analysis, understand the current and future demand of a cryptocurrency, identify the risks to its survival, and then bet on the upside potential in its price. When Bitcoin had its debut in 2009, its value was $0.002, very few people would have thought that it would be worth almost $20, 000 at the end of 2017. Some market analysts still believe that its current $6,300 is undervalued and that the Bitcoin could be worth $100,000 in the future. Other coins that hold similar promise include, Ethereum, Monero and Ripple.
- Buy and hodling for dividends
Cryptocurrencies are fundamentally different from stocks; but some of them have interesting organizing structures that allows you to earn dividends on your asset in addition to the price appreciation. Core security tokens also have dividends factored in to their tokenomics to give you returns on your investment. For informational purposes, some cruptocurrencies that pay dividends include KuCoin, COSS, and NEO – this is not an investment advice, consult a financial advisor.
- Stake your crypto for rewards
Some blockchains use a Proof-of-Stake consensus protocol that serves the function of maintaining the integrity and security of the ecosystem. Staking your coins in a live wallet on such blockchains gives you the right to earn additional coins. When you stake your coins, you technically can’t use/sell it without voiding your stake; hence, you’ll need to be sure that you won’t be worried about short-term price volatility before you go ahead to stake. Some coins that gives investors rewards in exchange for staking include Komodo, NAV coin, and Neblio.
- Get paid in crypto for microstasks/product/services
You can also earn cryptocurrencies by providing a service or selling products and choosing to accept payment in cryptocurrencies. Some platforms such as Bituro, Bitcoin Rewards, and Coinbucks allow you to earn crypto for performing microtasks. Platforms such as Coinworker, Bitwage, and Coinality allows your to earn cryptocurrency while being a part of the gig economy. You can choose to use a payment gateway that allows you to accept cryptocurrencies if you sell products online/offline.
- Run a Masternode
A masternode is essentially a full node of a blockchain or a wallet that keeps the complete company of a Blockchain in real time. A masternode will always be running, completing tasks, verifying transactions, and keeping the ledgers up to date. Different coins have different requirements for setting up master nodes but you’ll usually need at least 1,000 coin and you can expect to have as much as 25,000 coins to set up a masternode in a blockchain. In exchange, you’ll earn passive income based on the amount of work done to keep the network robust and secure.
