Staking
Staking involves locking up your coins to support a Proof of Stake (PoS) blockchain network. By staking, you help secure the network and validate transactions, earning rewards in return. Your rewards depend on the staked amount and the duration of your participation. Staking can be done through a staking wallet or by joining a staking pool.
Yield Farming
Yield farming involves lending or locking your cryptocurrencies into decentralized finance (DeFi) protocols to earn rewards. Rewards can be in the form of additional tokens or fees generated by the protocol. Yield farming can offer good returns but comes with high risk, as returns can differ depending on market conditions and the chosen protocols.
Crypto Lending
Crypto lending platforms allow you to lend your crypto assets to borrowers in exchange for interest payments. With crypto lending, it is important to assess various risks, such as the possibility of borrowers defaulting on their loans.
DEX Liquidity Provision
Decentralized exchanges (DEXs) enable users to trade cryptocurrencies with each other directly without intermediaries. By providing liquidity to DEXs, you can earn a share of their trading fees.
This involves depositing pairs of tokens into liquidity pools and letting other users trade against that liquidity. The income depends on the trading activity on the platform and the platform’s revenue-sharing model.