In recent years, we have witnessed tremendous growth in the digital currency market, as the total market value of this market has risen to exceed $2 trillion.
This boom reflects the growing interest in digital currencies and the opportunities for profit from investing in them.
So the most common question for anyone in this market is, “How do I profit from digital currencies?”
In this article, we will discuss the answer to this question by presenting 4 ways to invest in digital currencies:
1-Trading digital currencies
Trading is the buying and selling of digital currencies from the markets to make a profit.
Making a profit from trading cryptocurrencies is the oldest way to profit in this market.
The general idea of trading is to buy currencies at a low price, hold them, and sell them at a higher price.
There are several types of trading, the most prominent of which are intraday trading and leveraged trading:
Intraday trading
It is the process of purchasing digital currency as a fixed asset and its ownership belongs entirely to you.
What is special about intraday trading is that you buy cryptocurrency as an asset that you can keep for years and sell it whenever you want.
Trading with leverage
It is the process of purchasing digital currency through a contract that doubles your capital to enter into a short-term deal to achieve a quick profit.
The advantage of trading with leverage is that it increases your capital, but the negative is that you do not fully own the asset and losing the deal leads to a complete loss of your capital.
2-Cryptocurrency IPOs
Cryptocurrency subscription opportunities are the most profitable because you participate by purchasing a currency before it is listed on the market.
Opportunities for successful IPOs do not come every day, but the easiest and safest is to subscribe to platforms.
Platform subscriptions
Some IPOs for new cryptocurrency projects take place on cryptocurrency platforms.
Platform IPOs are the safest and easiest to participate in.
All you need is to allocate your capital for the subscription, then the platform will allocate the purchase limit to your account with which you can participate in the subscription.
One of the most prominent platforms with successful IPO projects is #Binance
The platform provides the #launchpad! service to be the subscription platform for new projects.
In addition, Binance offers the #Launchpool service in which you can participate by allocating capital for the subscription, and a share of the subscription coins is allocated to you for free.
3-Daily income from digital currencies
One of the ways to make a steady and daily profit from digital currencies is through storage or staking.
Most digital currency platforms or DeFi protocols have deposit services that offer annual returns in exchange for holding a specific currency.
Of course, this return is considered interest on the currency, like a bank deposit.
The return rate varies in terms of the currency, the duration of the deposit, and many other things, but in general, stable currencies such as USDT, USDC, FDUSD are a maximum of 10% annually.
For example, now on the Binance platform you can keep USDC for a return of 4.05%.
It means every day you take $1.1 if you store 10,000 USDC.
Of course, it is not a huge number, but the return rate for regular cryptocurrencies is higher because there is a risk rate, which is that the currency’s price is volatile.
Of course, if you go to the #DeFi protocols, you may find numbers much higher than that, but take it as a rule: the higher the return, the higher the risk.
4- Mining digital currencies
Cryptocurrency mining is the process of participating in processing transactions on a blockchain network and in return receiving coins as a reward.
Cryptocurrency mining may be one of the guaranteed ways to achieve an almost constant profit from digital currencies, but mining requires large capital and technical knowledge because you need to buy mining equipment that is expensive and you need technical knowledge to manage this equipment.
Cloud mining
It is participating in the mining process with your own capital only. Where mining capacity is sold in th/s units for a certain amount.
In return, the company or platform providing the service creates mining units and supervises the mining process on your behalf.
Cloud mining service is available at Binance Cloud Mining.
The price of 1 th/s is equal to $23.
Binance explains that the daily profit rate for one mining unit is $0.00000067 BTC per day, or about 4 cents per day.
This means that purchasing one mining unit at $23 will give you an annual profit of 60% at the current Bitcoin price.
It should be noted that cloud mining is preferable to trusted parties such as trading platforms, because many scams use cloud mining to steal participants’ funds.
Final tips
In conclusion, profit from digital currencies is a broad field that contains many opportunities, but it is not without risks. You should be very careful and conduct thorough research on the project you intend to invest in to ensure you fully understand what you are getting into.
Diversifying your investments is also one of the most important risk management strategies. By diversifying your portfolio, you can reduce the impact of any potential losses on your investments.
