- The crypto industry presented new horizons that many people take advantage of on a daily basis to generate a good amount of profit.
- Investors and traders can monetize through different methods to earn higher returns on cryptocurrencies.
Cryptocurrencies do not only work as digital assets, they also give the possibility of obtaining higher returns , ideal for investors and traders. Anyone who wishes can buy and sell through the exchanges. Virtual assets have opened many doors for thousands of users to earn high returns and turn their financial exposure into solid portfolios..
Get higher returns on cryptocurrencies: buy low and sell high
This is the easiest, most conventional and proven way to make money with cryptocurrencies. We simply buy a coin, let its value rise over time, and then sell it for a profit. Doing this can give us good returns. It can be done in two ways, although it will depend on our needs.
In the case of investors we can take a “buy and validate” approach. This is a long-term perspective. The idea is to hold the cryptocurrency until it increases in value over a period of time..
If we are merchants, we also have the possibility of buying a cryptocurrency and selling it in the short term, this will leave us profits periodically. Earnings will depend on the amount of cryptocurrency purchased. It can be of two kinds, daily trading where we are dedicated to buying and selling on the day; and the BTST trade where we buy today and sell tomorrow, as well as the swing trade where you keep buying and selling within the agreed time periods.
When we decide to invest in a cryptocurrency, the assets lie dormant in our wallet. This can lead to a stagnant value of the asset if the price falls. To try to avoid these cases, we can lend our crypto, which is known as P2P lending. There are platforms like BlockFI, Celsius, etc. That they admit this class of loans..
It could be said that it is similar to the bank loans that we are used to. The borrower has to temporarily leave something that becomes collateral for the loan. Similarly, it also happens with crypto loans, the borrower of crypto as collateral and, in return, receives cash or another cryptocurrency from the lender. The lender is entitled to receive an interest that will be paid with more cryptocurrencies, in addition to the amount that he originally lent.
In this way, good interest returns can be obtained without having to leave them idle in our wallet.
Staking is a way to validate blockchains. Owners of a coin lock up their holdings in favor of the blockchain to verify cryptocurrencies. It is a simple and productive way for the blockchain to save energy and use coins to validate the system.
This would be proof of stake (PoS). It is a feature that we can find in many cryptocurrency platforms, not only to help validate the blockchain; it also allows to earn high returns on our crypto.
We can block part or all of our cryptocurrencies, the idea is to earn more of this asset. The amount that we can earn is determined according to the annualized percentage yields (APY) of the individual cryptocurrencies and the platform itself.
To serve as an example, Nexo allows us a 12% annual return on USDT, while Celsius gives an 8.50% annual reward rate for the same cryptocurrency. Staking returns are rewards provided to those who help validate and secure the blockchain.
Although the value of the asset, and obviously its returns, can be affected by fluctuations thanks to changes in the asset's trading prices.
The literal translation would be “Yield Agriculture”. It would be something similar to stalking, although it potentially offers better returns. Additionally, it can be used on almost all cryptocurrency platforms, although the highest interest rates are only offered by decentralized exchanges (DEX) here we have PancakeSwap, Solana and Uniswap as great examples. These are platforms that are outside the reach of a central nodal authority, which allows us greater autonomy.
Thanks to this we can contribute our assets to the liquidity funds of the exchange. If we assist in a Cardano liquidity pool, then we enhance the ability of the exchange to hold a larger number of Cardano transactions.
This means that every time someone trades on Cardano, they will receive a portion of the trading fees. The process gives us the possibility to earn good returns through yield farming. Generally, various exchanges give the possibility to get more returns when you lend your own token.
Although the yield value of Yield Farming is highly dependent on the market prices of cryptocurrencies. For example, if we earn a 50% return and the coin has a 40% drop in the market, the return will be only 10%.
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