With traditional stock, currency, and commodities markets worldwide witnessing wild swings, investors are increasingly looking at bitcoin as an alternative investment.

Buying and selling bitcoins may not be as easy as you would imagine: It requires a deep understanding of the digital currency market including proper knowledge of how and when to buy or sell.

• How do you define bitcoin?
• How do I invest in bitcoin?
• How do I Buy Bitcoins And at What Rates?
• What are Bitcoin Wallets?
• Which Wallet is Ideal For me?
• How Stable is the Bitcoin Trading Market?
• How Much Tax do I Pay on Profits Made on Bitcoin Trade?
• Are There Any Commissions I Pay For Trading in Bitcoins?
• Who Can Become a Bitcoin Miner?
• What Type of Computers do I Need to Become a Bitcoin Miner?
• Is Bitcoin Mining Really Profitable?
• How Can I Make Money With Bitcoin?
• Can I Get Rich With Bitcoin?
• Can Bitcoin Make You a Millionaire?
• Can I Invest $100 in Bitcoin?
• How to Make Money With Bitcoin Mining?
• How to Make Money With Luno in Nigeria?
• How to Make Money With Cryptocurrency?
• How to Earn Bitcoins Fast
• How to Invest in Bitcoin
• How Much Bitcoin Will Make me Rich?
• How Many Millionaires Has Bitcoin Created?
• Who is The Richest Person in Bitcoin?
• Can Bitcoin Crash?
• Who Owns The Most Bitcoin 2021?

How do you define bitcoin?

Before we look at the pros and cons of investing, let us understand what is a bitcoin. Bitcoin made its appearance in 2008. It is not a stock or currency but some governments and regulatory authorities consider it as a commodity.

For example, in September 2015, the Commodity Futures Trading Commission of the US declared bitcoin and other digital currencies to be commodities as falling under its purview.
Can I expect good returns on my investment in bitcoin?

Read Also: Risks and Benefits of Accepting Bitcoin Payments in your Business

As a commodity, bitcoin has shown rather good performance in the market, giving investors high returns. For example, it offered 9.6 percent more return on investment (RO) as compared to coffee, 15 percent over soybeans and a whopping 13 percent as compared to crude.

Bitcoin returns were better than those offered by gold by about 6.7 percent, according to statistics from the US commodities markets. Bitcoin however enjoys the status of a currency but it is different from regular currencies. It is not issued by any bank or government and is not regulated by any authority.

How do I invest in bitcoin?

Broadly speaking, there are two types of investments you can consider in the bitcoin market.

Bitcoin trading:

You can open a trading account with any reputed bitcoin exchange, buy bitcoins when the price is low and sell them when the price increases. This is similar to trading in other currencies. The amount you wish to invest depends upon your budget. Some bitcoin exchanges offer free advice for investors, which can prove useful to a beginner.

Bitcoin mining:

The other type of investment is on bitcoin mining. You may wish to consider this only if you have excellent knowledge about computers, software, and the Internet. Investments in bitcoin mining tend to be heavy since it involves buying very powerful computers that consume large volumes of electricity.
The most common form of investing in bitcoin is trading in this digital currency.

Is bitcoin trade so simple?

No. It is very complex. First, you need to study the bitcoin market and watch the price variations closely. Remember that bitcoin has no collaterals like gold and derivatives. There is no regulatory authority that guarantees your bitcoin is worth cash.

At launch in 2009, a single bitcoin cost US$1, and today the rate swings between US$ 800 and US$1,100. So you should have a considerable amount of cash for investing in bitcoin for a better profit.

How do I Buy Bitcoins And at What Rates?

As discussed earlier, bitcoin has no fixed price. Rates can swing wildly too. You will need to contact a reputed bitcoin exchange online to find the rates at which you can buy. You might come across an exchange willing to sell you bitcoins at a lower rate.

But check out their credentials since there are instances where online bitcoin exchanges have vanished overnight after duping customers of their investments. You must get a complete idea before buying your first bitcoin otherwise you will be in a big loss.

How do I Own Bitcoins?

Bitcoins are fully digital. Meaning you will not receive paper or metal currency that can be stored safely. Before buying bitcoins, you need to get yourself a bitcoin wallet from any reputed source. All bitcoins you buy should be stored in this electronic wallet only and never kept lying with the exchange or seller.

What are Bitcoin Wallets?

Storing bitcoins requires special wallets. There are several types of wallets you can consider. Bitcoin wallets can broadly be classified in two categories- hot wallets and cold wallets.

Hot wallets: They are connected to the Internet or is constantly online with the exchange house or the bitcoin trading channel. These are popular among people who own small number of bitcoins and are trading frequently.

Cold wallet: Cold wallets are those which are offline but can be connected to the Internet or other online systems whenever required. These are ideal for storing a large number of bitcoins since the chances of hacking or illegal access is reduced.

Which Wallet is Ideal For me?

You can choose to use a hot wallet or cold wallet to suit your specific needs. All wallets offer hot and cold facilities. Wallets that you can choose include:

1. Desktop wallets: Such wallets are downloaded on PCs and laptops and work on different operating systems including Windows, Mac OD, and Ubuntu. A desktop wallet can be connected to the Internet when required.
2. Mobile wallets: They can be downloaded on any smartphone that uses the Android, Blackberry and IOS systems. Mobile wallets have a QR code system which renders it safer. Mobile wallets are also useful for making instant payments.
3. Online web wallets: These are provided by third parties and can be accessed only when you go online.
4. Physical wallets: Comes in form of the special hardware that stores bitcoins safely. The hardware can be connected to the Internet when desired. Access is through user names and passwords.
You need to be very cautious about which software wallet you download or use. Some scammers include malware – which is capable of stealing your access codes and bitcoins. Do not trust any software wallets from unknown sources.

How Stable is the Bitcoin Trading Market?

The bitcoin market is on an upward swing but far from stable. There can be days when a particular online casino or business house, exchange or individual may decide to sell their bitcoins for cash. The high supply and low demand will cause a drop in prices.

On other occasions, you may see high demand and low supply which can send bitcoin prices soaring. Even if you buy when the prices are low and sell when they rise, the profits can take days to come into your account due to various technical reasons.

How Much Tax do I Pay on Profits Made on Bitcoin Trade?

Bitcoins offer complete anonymity to buyers and sellers. Meaning, nobody can know that you own bitcoins. All trade will occur on your digital identity and address generated by the bitcoin software. The high level of anonymity provides for tax evasion.

But various countries are aware of this loophole and are working towards taxing profits made by bitcoin trade too. You may wish to consult your taxman or nearest tax office to get full details.

Are There Any Commissions I Pay For Trading in Bitcoins?

Bitcoin is open-source software that can be accessed by anyone who is suitably equipped. Since there are no regulators, you may decide upon the amount of commission or service charges you wish to pay when buying or selling bitcoins.

Or you may choose not to pay at all. One flaw is that bitcoin miners who assist the trade process, tend to prioritize transactions with high commissions or service fees. Thus, the speed of your transaction can depend upon what you are willing to part with for the service.

How do I Earn Bitcoins?

There are no free bitcoins to be earned. The only known manner by which you can earn bitcoins free is- if somebody gifts them to you or, by becoming part of the bitcoin trading chain. This means you need to become a bitcoin miner.

Who Can Become a Bitcoin Miner?

Anyone with basic knowledge of computing can become a Bitcoin miner but your skills and the type of computers you use will decide your profits. Remember, the bitcoin trade chain, called the blocking, is operated and maintained by individuals and groups, or companies.

The price of bitcoin has risen exponentially over the years. Therefore more people are now involved in the bitcoin mining and blocking process than ever before.

What Type of Computers do I Need to Become a Bitcoin Miner?

This is a very complex question. It boils down to the amount of money you are willing to invest. Bitcoin mining computers are called ‘rigs’. You can either design your own bitcoin rig, have one assembled to suit your requirements and budget or buy one directly from any provider.

What Are The Basic Specifications of a Bitcoin Rig?

Bitcoin mining depends upon your Graphics Processing Unit (GPU) rather than your Central Processing Unit (CPU). Because GPUs can solve complex mathematical algorithms faster than CPUs. The faster you solve the algorithm, the more bitcoins you can earn. A list of good GPUs and other specifications for a basic mining rig can be found at Bitcoin or LiteCoin.

Any other requirements?

Yes. You should ensure an uninterrupted power supply for your rig. Using a high power line, inverters, and backup power supply sources can also help. Typically, a basic mining rig will use two GPUs and your computing power should be around 1,000 W or higher.

Again, these sites will provide you with more detailed specifications for a bitcoin rig. Bitcoin and other cryptocurrencies operate on what is technically called the SHA-256 algorithm, which can be processed only by a GPU.

What about the software?

As with any other computer or your PC, laptop, all software, especially drivers for the graphics card, anti-virus and other software should be fully updated. You will need to provide adequate space on your hard drive to accommodate as many updates and complex software. You can either operate with Windows of MacOS, depending upon your budget and ease of use.

Any specific software that I need to download?

Yes. There are two main types of software that you will need to download, update and maintain on your rigs. These are special software for bitcoin mining. Some of these are:
• CGMiner
• Poclbm
• Phoenix Miner (Linux)
• DiabloMiner (MAC OSX)
You will require a wallet to store the bitcoins you earn as a miner.

Is Bitcoin Mining Really Profitable?

This depends upon your skills and the type of rig used. You can more details about the profitability of bitcoin mining can be found at 99Bitcoins.

A bitcoin miner can earn the average US $500 per month provided mining is done in a completely dedicated manner. However, this amount can increase or decrease depending upon your power consumption and fluctuations in bitcoin trade during any part of the year or for any reason.

With more people entering the bitcoin mining industry, profits are dropping. You will also have to consider costs of power, expenses on maintaining and upgrading your bitcoin rig, and other charges.

Is income from bitcoin mining taxable?

As discussed earlier, bitcoins provide a very high degree of anonymity to the user. Taxation policies defer according to geographical areas. You may wish to consult your taxman or get details from the nearest tax office.

Are There Ways to Increase Profits?

Working in groups as bitcoin miners increase profitability but do not reduce your operating costs. The total number of new bitcoins earned by a group is divided among its members. You can consider joining such a group.

A word of caution: Most groups of bitcoin miners operate online and there are no known means to detect their physical identity and location. Some scammers pose as mining groups and offer big profits. They vanish with your hard-earned bitcoins, without a trace.

How Can I Make Money With Bitcoin?

In 2021, Bitcoin is set to turn 12 years old—oh, how time flies. We’re sure that everyone here has at least heard of it by now. As our favorite digital currency continues to mature over time, so do its money-making opportunities. More people are figuring out how to make money with Bitcoin, and we understand that it can sometimes get hard to keep up.

1. Buying and holding

Buying and holding Bitcoin is the answer to the age-old question of “How to invest in Bitcoin and make money?”. HODLing, the other term for buying and holding, is one of the most straightforward and most beginner-friendly trading strategies out there.

First, get a Bitcoin wallet, buy BTC, and then hope that the Bitcoin price spikes in the future—no matter how long that may take. It could be weeks, months, or even years before you decide to sell.

The term HODL was coined because of this. It started as a typo on a forum, then it became a full-time trading strategy. It also means to Hold On for Dear Life—so it’s essential to look at how Bitcoin is valued and go from there.

2. Trading

If HODLing is long-term investing, trading Bitcoin is its fast-paced equivalent. Essentially, BTC trading means taking advantage of Bitcoin’s highly volatile nature. This method requires practice and knowledge of the market, so be sure to do your homework before you even think about giving it a shot.

Here are a few styles of trading to get you started:

• Day trading – Bitcoin day trading entails short and quick trades, allowing opportunities for small and fast profits. Day traders don’t hold any open positions overnight, so the method consists of carefully analyzing the market, seeing small money-making opportunities, and capitalizing for a small profit. At the end of the session, day traders could have a significant cumulative gain.
• Swing trading – If HODLing is long-term and day trading is short-term, swing trading is kind of in the middle. Like HODLers, swing traders will buy low, wait long enough to see their holdings increase in price, and then sell high. However, their holding time isn’t as long as a HODLer and isn’t as short as a day trader.
• Arbitrage – Bitcoin arbitrage is similar to the styles above. However, instead of looking for money-making opportunities within the same exchange, traders who use arbitrage look for those opportunities across different platforms. In essence, they buy BTC from exchange A then sell it at exchange B for a higher price.

How to make money off Bitcoin using these methods requires a lot of practice, so don’t expect to get it right on the first try. Just do your own research, figure out which strategy is best for you, and trust that you’ll be on your own way.

3. Accepting Bitcoin as payment

As it continues to mature, we’re starting to see more and more businesses that accept Bitcoin as payment for their goods and services. So if you’re already running a business, why not consider taking BTC as payment?

It’ll widen your global reach, make payments secure, and speed up the entire payment process. The best part is that it’s incredibly easy to start accepting Bitcoin. If you’re running a physical establishment, it’s a matter of putting up a small sign at your storefront and beside your cash register.

If your business is online, you can put a banner on your home page or use a payment intermediary like Pay with Paxful to fully integrate it into your website. At those points, customers can just send funds directly to your Bitcoin wallet.

Once you start raking in the BTC payments, you can then use those funds for investment—and who knows? It may just grow in the future.

4. Using Bitcoin faucets

Are you one of those people that like looking at ads and answering surveys? Wow…really, you are? Well, okay then!  Why not check out a Bitcoin Faucet?

Bitcoin Faucets are basically rewarded systems that give BTC fractions to those who complete menial tasks—like watching ads or answering surveys. Some even come in the form of minigames!

5. Taking advantage of affiliate marketing

A lot of companies use affiliate marketing to bring in new customers. This type of marketing incentivizes existing users to bring their friends and family to the business as well. You’ll see these types of incentives all over the market, but they differ from one another—so carefully study each one and choose which program you want to invest your time in.

6. Getting tipped in Bitcoin

One of the most fulfilling things in this world is helping other people out—and if you get tipped a little money on the side for it, even better!

One of the most notable platforms to do so is Bitfortip, which gives BTC as an incentive for helping people out with various kinds of tasks. These tasks range from helping people find a dress online to giving informed technical answers to their questions.

Additionally, if you’re a gamer who loves streaming your favorite video games, why not accept tips in BTC? Twitch and other streaming platforms have integrated crypto-tipping services, so be sure to check those out!

7. Microjobs and Pay-to-Click (PTC) websites

Several websites will pay you in Bitcoin if you watch an ad or click on a link to a particular page containing ads. Bear in mind, to make any significant money is still very hard work and a tedious task.

If you’re immune to that, these sites are an excellent way for you to earn a quick buck. Coinpayu and adBTC are good sites to check out if you’re interested in making money with cryptocurrency.

Similarly, Microworkers and Cloudfactory are sites that pay you a small fee to complete very simple tasks like watching a YouTube video or completing someone’s survey. These sites have Bitcoin counterparts like Bitcoinget and Cointasker, where members can choose thousands of tasks to complete to earn Bitcoin.

8. Writing about Bitcoin

In general, cryptocurrency is a new niche, and only a handful of writers genuinely know this niche. This means the market is flooded with newbie copywriters who rehash the content over and over again.

So, if you really know this niche and have decent writing skills, why not try your hand at educating the masses with your craft? CryptoCurrency News and Blockchain Aliens are among several websites that can pay you for writing about Bitcoin. You can also use a lot of freelance websites like Upwork and Freelancer.

9. Bitcointalk forum campaigns

Bitcointalk is one of the oldest forums out there. In fact, it was set up by Satoshi Nakamoto himself. It’s probably the most popular forum in the crypto sphere, being used by millions of people.

If you’re an avid follower of the forum and have racked up some authority from consistent posting, then your posts on Bitcointalk will have a sponsored signature. Eventually, you can get paid for every post you make on the forum.

10. Lending Bitcoin

The decentralized nature of Bitcoin and other cryptocurrencies makes it simpler to make transactions. This is because you won’t need any authorities to validate it.

Because of this decentralization, you can also loan BTC to potential loanees at an interest rate. Think of it as a way to make your money flow even when you’re HODLing—you’re actually making use of the wealth rather than keeping it unmoved in your wallet.

Unchained Capital, Bitbond, and BTCpop are some of the websites you can use to help you with your lending services.

Can I Get Rich With Bitcoin?

You have two options: mine or trade. By mining for Bitcoins, as long as the markets remain active you can basically make money for nothing. But the problem is, mining is such a tough gig now that it is hardly worth it. Turning your computer into a miner will likely make it noisy and heat up.

It would likely take you a long time to even mine a single Bitcoin, by which time you probably would have spent more on electricity. However, if you have access to some serious computing power and you don’t have to pay the bills, you could make some easy money here.

The more realistic way of making a million with Bitcoins is going to be trading them through the most prominent exchanges, such as Coinbase. Back in 2011, you could have bought Bitcoins for $10.

Selling them at $1,000 today would have delivered a profit of $990 per Bitcoin. Basically you should have bought about 1,000 Bitcoins back when they were cheap. This would have cost you around $10,000 in 2011, making you a millionaire today.

Making a million with Bitcoins today is probably still possible, but you will need some capital. Bitcoins can fluctuate many percentage points every day (on May 22, 2017 the price jumped up 10%). Day trading Bitcoins is going to be risky, but where is there is volatility there is opportunity.

Otherwise, you need to take a longer-term approach and conclude whether or not you think Bitcoin will be successful. If you think Bitcoin is going to be traded by foreign exchange dealers, market makers and institutions one day, you might want to go long. 

Buying right now would be incredibly risky; the price chart is screaming “bubble”, but your point of entry is up to you. Don’t expect to see more of the same fast growth now though.

On the other hand, if you have a strong conviction in the downfall of the Bitcoin, you need to short the cryptocurrency in any way you can. This would be an extremely risky endeavor still, but if the Bitcoin market is truly destined for failure, why not get rich when the bubble pops?

To short Bitcoin, you will either need to get creative or join an exchange which allows you to do so.

Can Bitcoin Make You a Millionaire?

Back in 2011, you could have bought Bitcoins for $10. Selling them at $1,000 today would have delivered a profit of $990 per Bitcoin. Basically you should have bought about 1,000 Bitcoins back when they were cheap. This would have cost you around $10,000 in 2011, making you a millionaire today.

Making a million with Bitcoins today is probably still possible, but you will need some capital.

Can I Invest $100 in Bitcoin?

Say you got into the game when a bitcoin was 10 cents, around October 2010. If you invested $100, you’d have been able to buy about 1,000 bitcoins.

At its all-time high Thursday, those 1,000 bitcoins would’ve been worth more than $48 million, not accounting for compounding and assuming you bought and held the asset the entire time.

To be sure, that’s a long time to hold a highly volatile asset, meaning that the group of people who both invested in bitcoin that early and have largely held onto their investments is small, said Polotsky.

The best way to invest $100 in Bitcoin today is using a Bitcoin exchange. These services allow you to make recurring Bitcoin buys on a regular schedule (every week, every month, every day, etc), or one-time purchases.

These services do usually require you to verify your identity, which can take up to a few days. Just be aware that there are higher fees on credit card purchases!

How to Make Money With Bitcoin Mining?

Bitcoin mining can still make sense and be profitable for some individuals. Equipment is more easily obtained, although competitive ASICs cost anywhere from a few hundred dollars up to about $10,000. In an effort to stay competitive, some machines have adapted.

For example, some hardware allows users to alter settings to lower energy requirements, thus lowering overall costs. Prospective miners should perform a cost/benefit analysis to understand their breakeven price before making the fixed-cost purchases of the equipment. The variables needed to make this calculation are:

• Cost of power: what is your electricity rate? Keep in mind that rates change depending on the season, the time of day, and other factors. You can find this information on your electric bill measured in kWh.
• Efficiency: how much power does your system consume, measured in watts?
• Time: what is the anticipated length of time you will spend mining? 
• Bitcoin value: what is the value of a bitcoin in U.S. dollars or other official currency?

There are several web-based profitability calculators, such as the one provided by CryptoCompare, that would-be miners can use to analyze the cost/benefit equation of bitcoin mining. Profitability calculators differ slightly and some are more complex than others.

Run your analysis several times using different price levels for both the cost of power and value of bitcoins. Also, change the level of difficulty to see how that impacts the analysis. Determine at what price level bitcoin mining becomes profitable for you—that is your breakeven price.

As of May 2020, the price of bitcoin is hovering around $8,000. Given a current reward of 6.25 BTC for a completed block, miners are rewarded around $50,000 for successfully completing a hash. Of course, as the price of bitcoin is highly variable, this reward figure is likely to change.

How to Make Money With Luno in Nigeria?

The world of crypto investment can be a confusing place. It’s still a new arena – not yet a teenager – and even those who have been around since the beginning have to deal with the occasional curveball.

Here are a few of the most common strategies we’ve seen people employ when investing and trading in crypto. Which one works for you will depend on a variety of factors – your tolerance for risk, the time you want to commit, and so forth. It comes down to individual circumstances. Just because it’s worked (or not worked) for someone else, doesn’t mean it will necessarily have the same impact for you.

The key is to do as much research as possible. We always encourage you to do your own research into what works best for you and, even more importantly, never invest money that you cannot afford to lose.

The legal stuff. The content of this article is for information purposes only and is not investment advice or any form of recommendation or invitation. Luno always advises you to obtain your own independent financial advice before investing or trading in cryptocurrency.

HODLing

HODL is a word derived from a fortuitous misspelling of “hold” by a poster on the Bitcoin Talks online forum. It’s also sometimes used as an acronym for ‘Hold On for Dear Life’.

Simply put, HODLing is when you buy a lump sum of cryptocurrency and store it securely for potential long-term, long-range, and long-odds growth.

HODLing is a basic strategy with little nuance, but it has proven effective for many when you consider Bitcoin’s meteoric rise in value since its inception. For example, 1 Bitcoin for $410.58 on 11 March, 2016 was worth $5165.25 on 13 March 2020 – a return of almost 13X.

There are also risks with HODLing, as it does limit your options. If you don’t time the bottom of the market and the market drops, you can only really wait and watch or cut your losses, which can be nerve racking. This is why you should never invest more than you can afford.

Crypto-cost averaging

This is a variation on HODLing that mitigates against some of the risks inherent in that particular strategy. The goal is to make regular investments of the same amount at repeated intervals, regardless of the day-to-day price. This strategy hedges against major market movements up or down, and takes a long-term position over several months or even years, thereby helping you to avoid mistiming the market.

Day trading

Day Trading offers a great deal more nuance than HODLing, but also requires a far greater time investment.

It is focused on short-term investment – you buy cryptocurrency at what you consider a low price based on anticipated short-term movements, in expectation that the price will move in your favour and you are able to sell your investment at a profit (although sometimes the price does the opposite of what you were expecting).

There are a variety of tactics you can employ to try and predict these movements based on different kinds of analysis.

The “day” aspect of day trading relates to the short-term nature of the position you take. This usually relates to a few hours.

For example:

1. A big US bank is going to be using XRP for their international payments. Jimmy thinks that this means the price of XRP will increase in the next few minutes.
2. He buys 1000 XRP at a price of $0.20 for a total of $200.
3. Other people see the same news and also try to buy XRP, causing the price to go up.
4. An hour later, the price of XRP has risen to $0.25 and Jimmy has decided he wants to sell to make a quick profit.
5. Jimmy sells all 1000 of his XRP for $250, totalling $50 profit.

Swing trading and scalp trading

Swing trading cryptocurrency is similar to day trading, but you hold your positions longer than a single day – until the market trend (or swing”) you are seeing runs its course or shows signs of a reversal.

This strategy requires less time and attention, but you still need to catch trends the moment they form. The extra time you are holding your position may allow for a greater price shift and therefore may result in higher profit than with day trading. Be careful however, as the price may swing against you resulting in you losing more.

Scalp trading is when you take a position for much shorter periods of time, whether seconds or minutes. The gains here are much smaller and require more focused attention, but because you can make so many of these types of trades per day, they have the potential to be more profitable than the longer term strategies.

Automated trading

Those attracted to the idea of short-term trading strategies (like day or scalp trading) but lacking either the time or patience to actually do it, can also automate their trading processes to react to changeable market conditions on their behalf.

This is done using trading bots, which is software that handles your trades for you. On the plus side, it can do your bidding while you sleep. You also have some control over what it trades – from basic stop losses to trading more complex price movement indicators.

On the downside, a trading bot is not artificial intelligence. It will not think for you. It will not figure out the best strategies to give you the most profitable trades. A trading bot is only as smart as the person who built it and it will only expect a set of actions to perform and will repeat those actions, nothing more.

These are just a few of the most common strategies we’ve seen employed at Luno, but there are many more out there. Find the one that works best for you and make sure to thoroughly research the market so you’re armed with all the information you need to make good financial decisions. And remember, there are many different kinds of analysis out there, but none of them are foolproof.

How to Make Money With Cryptocurrency?

Everyone gets into the cryptocurrency field to make money, but not all end up doing that. A lot of people either simply give up along the way or fall into some sort trap with the rising cases of crypto scams.

Truth be told, there are quite a handful of methods you can make legitimate money with cryptocurrencies other than the obvious way of trading. We, therefore, decided to explore some of the proven ways of how to make money with cryptocurrency; we found quite a few, but be assured that you’ll find them very impressive.

Without further ado, below are 10 ways to make money with cryptocurrency today.

1. Buy and HODL

This is the most common way of earning money from cryptocurrencies. Most investors buy coins such as Bitcoin, Litecoin, Ethereum, Ripple, and more and wait until their value rises. Once their market prices rise, they sell at a profit.

This investing strategy requires one to identify more stable and volatile assets that can shift in value rapidly, resulting in regular profits. Assets such as Bitcoin and Ethereum have been known to maintain regular price fluctuations; they can, therefore, be considered a safe investment in this regard.

However, you’re welcomed to trade any asset you feel is going to rise in value; all you need to do is to analyze each asset you invest in before committing to HODLing it.

Also, you don’t need to buy the most expensive assets for you to make profits. There are thousands of small altcoins that have decent price shifts; consider having a mix of all coins that have a promising future value and are not just popular in the exchanges.

2. Earn Cryptocurrency Dividends

Did you know that you can buy cryptos and hold them for the dividend? Well, there are a number of coins that will get you paid for simply buying and holding their digital assets. The best thing about these coins paying a dividend to holders is you don’t even have to stake them, especially in a wallet.

A few examples of coins that pay out dividends include COSS, CEFF, NEO, KUCOIN, and more.

Just like the conventional stocks, not all of these coins, are suitable for your portfolio; you’ll need to analyze and pick out what seems to align with your investment objectives.

3. Run Cryptocurrency Master Nodes

What is a crypto master node?

These are full nodes that motivate operators of the various nodes to execute their roles in operating a blockchain. In other words, a master node is a cryptocurrency full node or computer wallet that maintains a real-time record of a blockchain’s activities.

Running crypto master nodes is one of the most popular ways of earning passive income in this space. But how exactly do you make money from this?

Allow me…

Many cryptocurrencies pay node operators to maintain a real-time record of their activities on their native blockchains. Since the process is complex and requires one to maintain a certain minimum number of coins under their master nodes, crypto platforms prefer outsourcing the service to master node operators at a fee.

Examples of proof of stake cryptos that have master nodes include DASH and PIVX.

4. Stake Cryptos

This is another method of earning money from cryptocurrencies; it offers a double earning potential through price appreciation and dividend payout from selected coins for staking (or proof-of-stake) their digital assets.

Staking involves holding coins in a live wallet, thus allowing you to earn additional coins for securing that particular crypto network.

Some examples of coins that can be staked include NAV Coin, PIVX, Neblio, Decred, and many more.

5. Day Trading

More than 80% of cryptocurrency investors believe that the only effective way (if not the only way) to earn money in this space is through day trading.

But what most of them don’t know is that day trading is more than just holding an asset until its value rises; it takes a lot to be a day trader, but most importantly, you need to have the proper analytical and technical skills.

You’ll need to analyze market charts on the performance of the listed assets; this is perhaps the most involving way of earning from cryptos but I believe one of the most rewarding.

You can start day trading on any exchange today; all you need to do is to sign up, buy some assets, analyze, and you’re all set.

You an also start trading through an automatic trading platform like bitcoin profit  which allows users to decipher the signals emitted by the trends on bitcoin and other cryptocurrencies and start perform successful small trader.

Tip: If you’re going to be a day trader, consider mastering the art of analyzing stocks using the technical and fundamental methods; they are widely used to evaluate all traded assets.

6. Help Out with Cryptocurrency Microtasks

If you have extra time, you can also do some small tasks for individuals or cryptocurrency platforms and get paid for it. The tasks can widely vary; it could be apps testing, adverts viewing, taking surveys, watching videos, and more.

You can get microtasks from sites such as Bitcoins Rewards, Coinbucks, or Bituro.

7. Work for Cryptocurrency Companies

This is a common way of earning from the sector. Anyone can work for a cryptocurrency company at any capacity; you can be a digital marketer, content creator, web designer, among other things. All you have to do is to identify their needs and show them how your skills can help solve a problem.

The best thing about working for crypto platforms is that you’re likely to work remotely, allowing you to benefit from the flexibility of working from your own space.

Other than that, most crypto firms offer very competitive packages, and if you happen to come by a chance to work with any legit ones, don’t hesitate to take up the opportunity.

Below are a few examples of platforms that pay in digital assets for services rendered:

• Coinality
• bitWAGE
• JobsforBitcoin
• Angle.co
• XBTFreelancer
• Coinworker
• 21.co

These companies offer their compensation in terms of cryptos; this, therefore, means that the value of your earnings can more than double in value within days if not hours.

8. Crypto Arbitrage

The cryptocurrency sector is largely unregulated; this has resulted in a lot of variations in terms of assets valuation, pricing of products, and so on. Most exchanges decide for themselves the prices their assets at are listed, and this has brought avoid the difference in the volatility and liquidity of assets.

If well researched, one can make a kill from these price variations through buying from cheap sources and selling on overpriced exchanges. This is pretty much what describes arbitrage.

If you get your act together, you can find anything between 5% – 30% in price spreads across various exchanges. Consider signing up on various platforms and compare asset prices to find any meaningful variations to capitalize on.

9. Cryptocurrency Faucets

Crypto faucets are not that popular, but a very viable mean of income generating. Bitcoin faucets are the most popular ones and they are basically a reward system that runs in the form of a website or application that offers rewards to qualified users in form of a Satoshi. A Satoshi is a hundredth of a millionth BTC; a reward awarded for completing a task such as a capture or any other as may be required by the application or website.

The tasks may also be in form of fun activities such as playing games, watching videos, viewing certain ads. Each task that’s accomplished earns you a small portion of Bitcoin. You may need to complete quite a number of tasks to be able to make any tangible income from cryptocurrency faucets.

10. Create Cryptocurrency Content

Over the last decade, content has become one of the most effective ways of communicating any message to your existing or potential clients. If you need to launch a new product or services, content is the best way to do that.

The crypto sector, especially, relies on content marketing a lot due to the fact that most projects are virtual. It may, therefore, not be possible to use conventional marketing ways to reach the target audience. And this is where the opportunity lies; you can  create video content, infographics, or written content for various cryptocurrency brands.

Some of the websites that offer regular gigs for content creators in the cryptocurrency space include Yours, Y’alls, and Steemit.

How to Earn Bitcoins Fast

Some ways of getting Bitcoin are better than other ways, while some are even worse than scams. That’s why today, we’re going to discuss some of the legit and low-entry barrier ways to earn Bitcoin.

1. CoinTiply

Cointiply is a Bitcoin rewards website to earn free bitcoin. Cointiply gives you tasks that could be done by anyone, and for every completed tasks, you end up accumulating bitcoin.

This a completely free website, and once you are registered, you can find lot of quizzes, surveys and other tasks tailored to your age, and location. Of course it’s a slow process, but if you are serious about earning Bitcoin for free, well this is the way to go.

2. Coinbase Earn

Coinbase earn is an educational initiative by popular USA based crypto exchange called Coinbase. Here is how Coinbase earn works:

• Head over to Coinbase earn site
• Create a free account
• Learn about any of the available cryptocurrency

You can then exchange these crypto for Bitcoin using Coinbase account, or continue keeping the same coin.

3. Play Games and earn Bitcoin:

This is a new way to earn free Bitcoin in 2021, and you may hear more such opportunities in the coming days. At the time of writing, this trick is available only for U.S.-based users who play counter-strike Go.

Here is how to earn Bitcoin while playing games:

• Download Infuse client by Zebedee
• Download and install Zebedee wallet on your phone
• Connect Zebedee infuse client with your Steam account.
• It would show you all the available servers along with the entrance fees

4. Get Bitcoin from One of these websites:

These are some of the most trusted websites to get Bitcoin. The best part is, they provide you with a Bitcoin wallet address and you can store or spend Bitcoin from these wallets directly.

• Binance
• CEX

5. Work For Bitcoin

Working for Bitcoin is one of the easiest and most legit ways to earn it.

Whether you are an engineer, designer, writer, singer, translator, editor, internet marketer, freelancer, or developer, you can start working for Bitcoin right now.

There are numerous platforms and websites that offer you bitcoins in exchange for your service.

Some of these platforms are:

• Cointiply
• Cryptogrind
• Jobs4Bitcoins
• Coinality
• Crypto.jobs
• bitWAGE
• Angle.Co
• 21.co

How to Invest in Bitcoin

Here’s how to invest in Bitcoin, in 5 easy steps.

1. Join a Bitcoin Exchange

First, you’ll need to determine where you want to make a Bitcoin purchase. Most Bitcoin investors use cryptocurrency exchanges. There’s no official “Bitcoin” company because it’s an open-source technology, but there are several different exchanges that facilitate Bitcoin transactions. These exchanges are the middlemen of cryptocurrency investing, like a stock brokerage.

If you decide to purchase from an exchange, you’ll have to decide which exchange you want to buy from. Here are a few of the most popular options:

• Coinbase: A very popular crypto exchange that insures losses in the event of a security breach or fraudulent transfers
• Bitfinex: The longest-running cryptocurrency exchange that’s optimized for advanced traders and lenders (unfortunately, Bitfinex doesn’t currently accept US customers)
• Strategize the strengths and weaknesses of the company.

2. Get a Bitcoin Wallet

When you purchase a coin, it’s stored in a “wallet,” which is where all your cryptocurrency is stored. There are two types of wallets you can get: a “hot wallet” or a “cold wallet.”

A hot wallet is a wallet that’s operated by either your cryptocurrency exchange or by a provider. Some exchanges will automatically provide you with a hot wallet when you open your account. In any case, hot wallets are convenient because you’ll be able to access your coins through the internet or a software program.

Some notable hot wallets are:

• Electrum: Software that enables you to store your coins on your computer
• Mycelium: A mobile-only app for Android and iPhone users

However, hot wallets are not the most secure form of coin storage. If the hot wallet provider is hacked, then your coin information may be at risk.

A cold wallet is the safest storage method for your coins. A cold wallet is an actual piece of hardware that stores your coins, usually, a portable device that’s similar to a flash drive. Most cold wallets cost between $60 to $100. Some popular cold wallets are:

• Trezor
• Ledger Nano

If you’re only going to purchase small amounts of coin, then you might be fine using a hot wallet with an insured crypto exchange. But if you’re going to be trading large amounts of coin, then a cold wallet would be well worth your investment.

3. Connect Your Wallet to a Bank Account

When you’ve obtained your wallet, you’ll need to link it to your bank account. This enables you to purchase coins and sell coins. Alternatively, your bank account may be linked to your cryptocurrency exchange account.

4. Place Your Bitcoin Order

Now you’re ready to purchase Bitcoin. Your cryptocurrency exchange will have everything you need to buy. The big question is, how much Bitcoin should you purchase?

Some coins cost thousands of dollars, but exchanges often allow you to buy fractions of a single coin—your initial investment could be as low as $25.

Investing in Bitcoin is very risky, and it’s important that you carefully determine your risk tolerance and review your investment strategy before you purchase any Bitcoin. We’ll go over this in the next section.

5. Manage Your Bitcoin Investments

After you’ve purchased bitcoin, you can:

• Use your coins to make online transactions
• Hold your coins for a long period in the hopes it’ll appreciate in value
• Perform day trading with your coins—that is, buying and selling coins with other Bitcoin owners, which can be facilitated on the cryptocurrency exchange

Your cryptocurrency exchange will provide you with everything you need to buy and sell coins.

How Much Bitcoin Will Make me Rich?

So the market cap of Bitcoin currently sits around a tidy 1 trillion dollars. When we evaluate a given asset, it’s important we always look at capitalization and not price, since this tells us the potential price increase the market could support.

So what if we invested $1000 now…? How rich could we get?

The scenario we’ll consider is buying our Bitcoin now.

Everyone has their own definition of what “rich” means, but for this piece, I’m going to define it as having enough money to give up work.

A middle-class income in the US would be around $85k per year. The median age is around 40 and the average life expectancy is around 78. So let’s say we need to cover our salary for 40 years to give up work. This gives us a “rich” figure of:

rich = 40 * 85000 = $3,400,000

So to get rich from Bitcoin we’d need it to generate at least 3.4 million dollars to support a middle-class lifestyle for 40 years.

Is this possible based on Bitcoin invested now? Let’s find out…

The market capitalization of gold is estimated at around 11 trillion dollars. Bitcoin is often described as “digital gold” and there is speculation it may one day reach gold’s value, so let’s start with this.

To reach a market cap of $11T, Bitcoin would have to go up 10x in value. This doesn’t seem inconceivable since Bitcoin has already gone up by a factor of at least 10x since 2015, and a factor of over 75 million since it first launched!

So what would we need to invest now to be rich in say, 5 years, and Bitcoin reaches $11T market cap?

Amount to invest now = 3400000 / 10 = $340,000

So to have 3.4m in 5 years based on a 10x rise in Bitcoin price, we’d need to invest $340k.

Investing only $1k would give us $10k. This is a nice sum of money and a sizeable gain, but it’s hardly early retirement.

How Many Millionaires Has Bitcoin Created?

Bitcoin has been huge news lately, with many people investing in it and seeing a great return on their money. Can you imagine what return you would have seen if you had invested big when it was just starting? Well, becoming a bitcoin millionaire is a reality for the five visionary investors below:

1. Roger Ver – $520 million

Born in San Jose, California, Roger Ver is now a resident of Tokyo. He was one of the earliest advocates of bitcoin and made his fortune due to heavy investment in bitcoin-related start-ups. Doing this has seen him amass a huge $520 million fortune.

Ver became a fan of bitcoin as he supported the way it offered economic freedom from the traditional fiat currencies and banking systems. Indeed, this outspoken advocacy saw him given the nickname ‘Bitcoin Jesus’ in cryptocurrency circles. While it is not known whether he can walk on water, he has certainly given large amounts to charity to show his caring side.

2. Charlie Shrem – $450 million

Born in Brooklyn, New York, this guy is arguably the most influential bitcoin millionaire. In an extremely clever move, Shrem purchased large quantities of bitcoin before it exploded in price. This and other investments saw him earn a cool $450 million.

Not content with simply investing in the currency, he also founded BitInstant with some of his money and help from Roger Ver. Unfortunately, this led to him being found guilty of money laundering for the infamous deep web marketplace, The Silk Road. After his release from prison in 2016, he got right back to business and launched Intellisys Capital, which sells investment portfolios in Blockchain companies.

3. Dave Carlson – $350 million

Dave Carlson is a little different to most bitcoin millionaires as he made his amazing $350 million fortune from actually mining bitcoins himself. Hailing from North America, where he runs his mining operation in the Washington area, he got into bitcoin early in 2010.

Formally an engineer with Microsoft, Carlson saw the huge potential of bitcoin and founded MegaBigPower to mine coins. At it height, his operation was said to be earning around $8 million per month! MegaBigPower was recently acquired by Giga Watt, the company Carlson is now CEO of.

4. Jered Kenna – estimated $300 million

Proving that the bitcoin industry attracts people from all backgrounds, we have former US Marine Jered Kenna. Originating from San Francisco, he resides in the area still where he owns a craft brewery and the 20Mission space for start-ups. His bitcoin millions were made when he purchased his first batch for only 20 cents per coin. Selling for over $200 per coin, this was just the first taste of bitcoin success.

He went on to pioneer dark bitcoin mining pools, where individuals could invest anonymously in the digital currency. Kenna is also well known within the cryptocurrency industry for his 2010 reformatting of a hard drive that lost him around $200,000 in bitcoins!

5. The Winklevoss Twins – $150 million

These are the bitcoin millionaires that most of the public will know. Born in Southampton, New York, they attended Harvard for their later education. While at Harvard, they produced a forerunner of Facebook called ConnectU.

In later years, they would go to court to sue Facebook founder Mark Zuckerberg for stealing the idea for his site from them. They were portrayed by Armie Hammer in the Oscar-winning film The Social Network.

Following this, they were quick to spot the potential of bitcoin and invested heavily in it, to the tune of $11 million. As well as investing in the currency itself, they have also funded several bitcoin-based companies such as Charlie Shrem’s BitInstant.

This was in addition to creating Winkdex, which was a financial index to track the average price of bitcoin. All these endeavors have led to them amassing a large fortune between them, including the $150 million on their bitcoin investment.

Who is The Richest Person in Bitcoin?

Unsurprisingly, mysterious Bitcoin dynamo Satoshi Nakamoto tops the list with a staggering $34.9 billion estimated fortune.  

1. Satoshi Nakamoto

Nationality: Japan 

Company: Bitcoin 

Age: 45 

Estimated net worth: $34,937,100,000 

The true identity of Satoshi Nakamoto is unknown, but they’re credited as the person who first developed Bitcoin. The latest estimates predict that Nakamoto has 1 million Bitcoin, which in today’s money translates to about $34.9 billion, making them by far the richest person in crypto. 

2. MicreeZhan 

Nationality: China 

Company: Bitmain 

Age: 41 

Estimated net worth: $3,200,000,000 

Micree Zhan, also known as Zhan Ketuan, is the co-founder of Bitmain which is the world’s largest cryptocurrency mining company. He was ousted in 2019 but has since bought shares from other shareholders to claim back his CEO status. 

3. Chris Larsen

Nationality: United States 

Company: Ripple 

Age: 60 

Estimated net worth: $2,700,000,000 

Chris Larsen has co-founded several successful Silicon Valley startups, his most notable being Ripple which allows for international payments using blockchain technology. It’s used by some of the world’s biggest banks such as American Express and Santander. 

4. Changpeng Zhao

Nationality: China

Company: Binance 

Age: 43 

Estimated net worth: $2,600,000,000 

Changpeng Zhao, abbreviated to CZ, is founder and CEO of Binance. Binance claims to have 25% market share and is the largest crypto exchange in the world with $500 million in daily trading volume as of early 2019.  

5. Jihan Wu

Nationality: China 

Company: Bitmain 

Age: 34 

Estimated net worth: $1,800,000,000 

He co-founded Bitmain in 2013 with Micree Zhan, however the pair have had a rocky relationship. Jihan Wu announced in January that he’s leaving Bitmain to put an end to the power struggle between the two co-founders.  

6. Cameron & Tyler Winklevoss

Nationality: United States 

Company: Winklevoss Capital 

Age: 39 

Estimated net worth: $1,400,000,000 

The Winklevoss twins are known for accusing Mark Zuckerberg of stealing their idea for Facebook. They used some of their $65m settlement from this dispute to buy Bitcoin since 2012 and own an estimated 700,000 Bitcoin today.    

7. Mingxing Xu

Nationality: China 

Company: OKCoin 

Age: 34 

Estimated net worth: $1,400,000,000 

Mingxing Xu is the founder of OKCoin.com, a globally-oriented BitCoin trading platform. He was arrested in October last year for matters relating to his business and released in November, but did not publicise why.   

8. Matthew Roszak

Nationality: United States 

Company: Bloq 

Age: 48 

Estimated net worth: $1,200,000,000 

Matthew Roszak is co-founder and chairman of Bloq, a Chicago blockchain technology startup, and has been collecting crypto since 2012 as a long-standing advocate.   

9. Li Lin

Nationality: China 

Company: Huobi 

Age: – 

Estimated net worth: $1,100,000,000 

He is the founder of one of the three major exchanges in China and the world’s leading digital currency trading platform, Huobi – a Seychelles-based cryptocurrency exchange. 

10. Tim Draper

Nationality: United States 

Company: Draper Associates 

Age: 62 

Estimated net worth: $1,100,000,000 

He is the founding partner of venture capital firms Draper Associates and Threshold. Another early advocate, he bought $250,000 worth of Bitcoin when the price of a single Bitcoin was $6. 

Can Bitcoin Crash?

Crashes can happen, after all. Bitcoin fell over 80% during a yearlong decline that started in December 2017. But at that 2017 peak, all the cryptocurrencies out there were valued at about $580 billion, according to coinmarketcap. The amount of paper wealth that could evaporate is much higher today.

Would a cryptocurrency crash matter for anybody other than those left holding the bag? Sort of. Losing wealth can lead people to spend less since the futures they thought were paid for no longer exist, and that can dent the economy. But with all cryptocurrencies valued at $2.4 trillion, such wealth effects might be muted in a crash.

The dot-com collapse, which economists view as fairly well contained, wiped out $6.5 trillion of U.S. stock market wealth between the first quarter of 2000 and the third quarter of 2002, Federal Reserve figures show. And back then the U.S. economy was half the size it is now.

Read Also: Here’s how you can Practically use Bitcoin Today

Beyond that, as speculative and extremely volatile assets that most people don’t own, and which aren’t integrated into financial markets, cryptocurrencies appear isolated from the economy. “They’re kind of their own show,” says University of Toronto economist Joshua Gans.

The environment could change if more people start thinking of cryptocurrencies as an asset class and if it starts working its way into retirement accounts. The fallout from a crash would be even greater if a lot of investors borrowed to increase their cryptocurrency holdings, or used their cryptocurrency holdings as collateral for loans.

At that point, said Princeton University economist Markus Brunnermeier, “many people would lose a whole lot of money, and they might question the whole system. Why didn’t anybody protect them?”

Cryptocurrencies and the paper wealth they have created probably don’t amount to much of a risk for financial markets or the economy now. That doesn’t mean they might not later.

Who Owns The Most Bitcoin 2021?

Those who have the most Bitcoin may surprise you. At the top of the list is Satoshi Nakamoto, the cryptocurrency’s pseudonymous investor.

Research suggests that he has a war chest of about 1.1 million BTC, which is likely spread across multiple wallets. Every now and again, we have seen Bitcoin mined in this era move between addresses – and this activity has tended to spook the crypto markets.

Law enforcement agencies also feature highly on this list. Bulgaria managed to seize 213,500 BTC back in 2017 – before the cryptocurrency broke $20,000 for the first time. If it had held on to these coins, they would be worth a staggering $11.1bn at the time of writing. That would be enough to pay off the government’s debt… more than five times over.

Inevitably, the FBI also gets a mention. The bureau managed to seize 144,000 BTC when it shut down the Silk Road website all the way back in 2013. Unfortunately, it ended up selling this crypto haul for an average price of $334 per coin – meaning it missed out on $7.4bn in profit. 

In terms of people who make the Bitcoin-rich list, Cameron and Tyler Winklevoss appear prominently. They became billionaires after spending $11m of the cash they received after settling a lawsuit with Mark Zuckerberg on BTC – buying 1.5 million coins at $120 apiece.

Bitcoin’s price has since surged by 43,200 percent. Although they are unlikely to own all of this BTC in the current market, they’re certainly sitting on a gold mine.