Cryptocurrency has become one of the largest industries in the world, over $200 billion is circulated in the market every day. Trading cryptocurrency seems like a lucrative idea, but it becomes like a gamble without adequate knowledge or skills. And this one usually goes sideways.
There are various methods you can use when you trade cryptocurrency. Some of them require you to know about trading, while others are automated. Here we’ve made a list of ways you can both passively and actively earn with cryptocurrency.
Cryptocurrency trading involves the use of statistics and charts to determine the direction of the market. There are two ways to trade cryptocurrency. Spot trading and futures trading.
Spot trading is the buying and selling of cryptocurrency as a long-term investment. It involves buying the dip, and selling when there is a marginal increase in the value of the cryptocurrency asset.
On the other hand, futures trading involves making trades according to the direction of the market. In futures trading, you can either buy or sell at high leverage and make 10-50x the profit a spot trader would collect depending on the exchange platform you use.
Auto Trading/ Bot Trading
Auto or bot trading is the use of automated trading tools to determine the direction of the market. These tools also help to run trades. Some auto traders simply copy expert trades, while others use various trading indicators to run algorithms that trade for you.
Staking is the act of placing a certain amount of cryptocurrency in holding so that you can accumulate interest over some time. In staking, you can earn interest in the parent crypto that you stake, or earn crypto in another crypto that has not been listed. You can stake cryptocurrency in pools or farms.
A master node is a cryptocurrency user that owns a certain amount of a coin that allows them to earn coins every time a new block is added to the cryptocurrency. The amount of cryptocurrency required to create a master node depends on the cryptocurrency
Airdrops are freely distributed tokens or coins that you get for performing tasks on wallets and exchanges. They are also used by crypto companies to advertise the launch of a new token, blockchain technology, or feature. Airdrops are free and have values that range from $10-$100.
Wallets and Exchanges
An exchange is a platform that you can use to trade and stake cryptocurrency. Some exchanges contain cryptocurrency wallets, such as OSOM. A crypto wallet is a digital database that is used to store cryptocurrency. There are various types of wallets.
Multi Coin wallet
A multi-coin wallet is a wallet that can be used to store different types of coins and tokens. Multi Coin wallets allow users to add new cryptocurrencies using their contract address and blockchain network. Most exchanges contain multi-coin wallets.
Hardware wallets are encrypted hard drives created for storing cryptocurrencies. They have special encrypted keys which need to be input before you can access cryptocurrency stored on them.
In order to safely store cryptocurrency, you need a wallet. Most wallets are decentralized which means that they do allow access to your transaction records. It’s the same principle for cryptocurrency.