Earn Passive Crypto In 2022 (4 Effective Ways)
Just like you can earn passive income in the form of interest in your savings bank account, dividends on your stocks, and rent from your real estate, you can earn passive income from crypto as well. Thanks to DeFi (Decentralized Finance).
So if you are bullish on crypto and want to HODL your way to the moon, then you should put your crypto to use and earn some passive crypto income without actively trading it.
Here are 4 effective ways to earn passive crypto income in 2022:
Crypto Lending
Basically, crypto lending is all about lending your cryptocurrencies in return for regular interest payments.
If you lend your crypto, then you can get interest of up to 10% APY, depending on the platform and the cryptocurrency you are lending.
It works very similar to a bank account. Crypto lending platforms will hold your crypto and lend it to generate interest, which will be paid to you on a daily basis. But unlike fixed/term deposits in bank accounts, these platforms do not lock your crypto for a certain period of time. You will have access to your funds all the time.
There are two types of crypto lending platforms:
- Centralized Lending Platforms These are crypto lending services that offer deposits & loans on a centralized platform. Centralized lending platforms are regulated and you have to complete KYC in order to use them.
- Decentralized Lending Platforms If you want to control your crypto and do not want to complete KYC, then you should go ahead with Decentralized lending platforms. They offer trustless & permissionless peer-to-peer lending & borrowing.
How To Lend Your Crypto?
You need to signup on to a crypto lending platform, and deposit supported cryptocurrency to the platform through a web3 wallet. If you want to know the best market rates, then you should check DeFi Rate lending tab.
Crypto Staking
Staking is holding certain cryptocurrencies to earn a percentage-rate reward over time. It is one of the most basic and popular ways to earn passive income from crypto.
Staking is only available for cryptocurrencies that use Proof-Of-Stake consensus.
By staking your crypto, you not only earn passive income but also help secure the network against spam and malicious threats.
Crypto Cloud Mining
Cloud mining is the process of mining cryptocurrency without the direct use of mining equipment or hardware. All you need to do is purchase some of the operational capacity, or hashpower (H) on some Cloud Mining projects and earn crypto proportional to what you pay.
Liquidity Mining & Yield Farming
Liquidity mining is a process in which you lend crypto assets to a decentralized exchange(DEX) in return for rewards. DEXs are cryptocurrency exchanges that allow peer-to-peer transactions, eliminating the need for an intermediary like a bank, and DEX needs liquidity to allow trading between different token pairs.
To earn from Liquidity Mining, you need to deposit your crypto in a liquidity pool and you’ll earn Liquidity Pool Rewards based on your pool share.
All 4 ways to earn passive crypto are just a few to get you started on the journey. Also note that all the methods come with their own risk, so please do your own research before depositing your crypto anywhere.
