Real Talk: How Much Money Can You Make in Cryptocurrency?

Seriously, how much money can you make in cryptocurrency? Browsing through social media websites, YouTube videos, and apps like Twitter and TikTok leads you to believe there is fast, easy money to make in crypto. Quitting your current job and starting a new life making a lot of money quickly through crypto seems like a no-brainer, right? Well, you may want to lower your expectations a bit. There is easy money to make, but life-changing money won’t come quickly for most people, at least not immediately. With a bit of time, your financial dreams can be reached, and while you are waiting for that day to come, you can take solace in knowing you are accumulating more crypto over time using any of the methods discussed here.

So, how much can you make in Cryptocurrency?

Trading averages $98,000 yearly
Investing averages 850% returns holding Bitcoin for five years
Mining averages $2,900 yearly mining Bitcoin
Yield Farming averages 130% yearly
Staking averages 12% yearly
Play-to-Earn averages $10,950 yearly playing Axie Infinity
Airdrops average $30 per airdrop
Affiliate programs average 25% in new user fees

Great, so now you know the main methods used to make money through cryptocurrency. Which option is the best, though? Well, let’s quickly learn more about each of the possibilities. Into the “rabbit’s hole” we go:

How Much Can You Make Trading Cryptocurrency

Successful traders average between $21,000 and $175,000 a year. Trading involves investing assets for short periods. Day Traders are in and out of their trading positions on the same day. Swing Traders often stay in trades only for a few weeks or months. The top crypto traders can consistently turn a profit by following a strict set of rules, and they avoid breaking these rules at all costs. The rules vary for each trader, but most traders include the following rules:

Take profits. If you are up by 50% or more, start taking profits. The gains aren’t confirmed until you sell.
Don’t be greedy. Small gains each day quickly turn into large amounts of profit.
Avoid leverage. Leverage is borrowing money from a brokerage to increase the amount you can invest in a trade. Although it sounds like an awesome way to increase your gains, a bad trade can quickly result in losing all of your investment.
Set stop-losses. This is essential to being a successful trader. A stop-loss order limits your losses so that you will sell in cases where the trade is going in the wrong direction.
Don’t hold losing positions. Start selling if the trade is not going well and you are losing money. Don’t let small losses turn into big losses.

Successful traders can make a lot of money quickly, but most people suck at trading and end up losing their investment. Trading is the hardest option to learn and become good at. It isn’t recommended for most people and is not a quick way to earn crypto money because of the required learning curve. However, life-changing money can be found for the few who take the time to learn how to trade correctly.

How Much Can You Make Investing in Cryptocurrency

Investing is buying assets with the goal of long-term gains. Cryptocurrency investors will hold their digital assets for years using a “Buy and HODL” (Hold On for Dear Life) mentality. Some popular ways to invest are:

Look for new coins through ICOs (Initial Coin Offerings). These ICOs are a way for crypto companies to raise funds quickly and offer potentially massive returns for the investor due to the high level of risk. The highest return on investment from an ICO was from a cryptocurrency called NXT. It gave investors a return of 12,857,100%.
Look for NFTs (Non-Fungible Tokens) with high growth potential. All NFTs are unique. Some examples of NFTs include digital artwork, music, real estate, quotes, and cards. The most expensive NFT, Pak’s “The Merge,” sold for almost ninety-two million dollars. Buying the right NFT while still at a low price can make you a lot of money quickly.
Look for good coins and tokens that have significantly dropped in value. Crypto is a new asset class. Bitcoin, recognized as the first cryptocurrency, was created in 2009. Digital assets are incredibly volatile due to their young age. Over 80% of cryptocurrencies have decreased by more than 90% from their all-time highs in 2022. Based on past cycles, finding and investing in well-researched digital assets can mean returns that no other asset class on this planet can compete with. Bitcoin has given a return of over 850% in the last five years. This return percentage is even more remarkable when you consider it is based on its current high of $21,200, not its all-time high of almost $69,000. Selling Bitcoin during its all-time high would have given a return of over 2,600%.

Investing using the “buy and hold” mentality is a great way to build wealth. Holding an asset like Bitcoin for a few years to get incredible returns is well worth the time required. This is why buying good digital assets and “hodling” for a few years is so powerful.

How Much Can You Make Mining Cryptocurrency

Mining requires specialized computers, known as nodes or mining rigs. The miner is usually rewarded with cryptocurrency as compensation for completing blocks of verified transactions. Mining rigs vary in price depending on the components used to create the system. A low-end rig costs slightly less than $1,000, while a high-end rig can cost well over $20,000. Once the system is set up, miners can make anywhere from $360 to $5,400 yearly for each machine the miner is operating. This significant price range is due to factors such as the rig’s computer components, the amount of energy used, and the cost of electricity.

You should know mining isn’t a quick way to make money in cryptocurrency. It will take a few years before you break even due to the up-front cost of purchasing the mining rig. Mining is highly competitive, with many computer components continuing to get more expensive due to the high demand. Electricity will also be a recurring expense. Mining rigs will be running 24 hours a day, seven days a week, and require a lot of power to maintain. A lot of heat is also generated from the rig, so you will notice an increase in your electricity and air conditioning costs. That said, companies continue their cryptocurrency mining businesses because they are still profitable, even after all those expenses.

How Much Can You Make Yield Farming Cryptocurrency

Yield farming requires lending or staking cryptocurrency for rewards in the form of more cryptocurrency. Yield farmers can currently earn 250% a year, staking on popular Decentralized Exchanges (DEX) such as PancakeSwap. Other popular DEXs offering high yields are SpookySwap and Curve Finance. All of these exchanges offer a large variety of cryptocurrencies, and the level of risk is commensurate with the amount of yield being offered.

Yield farm DEXs are very complicated to learn and work with, so beginners should avoid them until they understand cryptocurrency and how it works. Also, the thought of earning a 500% yield on high-risk crypto is often too tempting to pass up, which can then quickly result in a loss of most, if not all, of your invested capital. So, is yield farming worth your time and money? With some time spent learning how the DEX works and which coins are worth the associated risk, you can make money yield farming, which should be an option.

How Much Can You Make Staking Cryptocurrency

Staking crypto is a way to earn passive income by locking up cryptocurrency holdings to obtain rewards or earn interest. Staking rewards can vary from 5% to 20%. Many coins and tokens can be staked for much higher rates than 20%, but as the rates increase, so do the risks. Staking crypto can be done through a large number of exchanges and brokerages. Coinbase, Binance, FTX, Crypto.com, and Etoro are some of the most popular staking platforms. Staking is very popular and is an easy way to earn additional coins on digital assets you are already holding.

Staking requires very little knowledge to begin with. You choose an exchange that offers staking, then purchase a cryptocurrency that can be staked, and you are done. Let the digital money start flowing in. There are a few things to consider when staking, though. First, many tokens have a mandatory lock-up period. These lock-up periods are usually a few days but, in some cases, can last for years. You will not be able to sell your staked crypto during this time. Another consideration is by staking on exchanges you are turning control of your staked crypto over to the exchanges. If the exchange closed due to financial difficulties, you would likely lose all of the staked crypto. So, is staking a good option? Staking is an excellent way to earn a good income and increase your cryptocurrency holdings over time. There are many cases where people supplement their income simply with the staked rewards being made each week.

How Much Can You Make in Play-to-Earn Crypto Games

Play-to-Earn (P2E) games reward players with digital currency or NFTs (Non-Fungible Tokens) for playing games and performing other services in the game. Axie Infinity players average between $10 – $50 a day, depending on the amount of time played and the player’s skill set. Other popular P2E games are “Decentraland” and “Gods Unchained.” P2E games are popular in the metaverse and continue to grow in number and popularity each year. Blockchain Game Alliance, an organization that promotes blockchain games, stated in its 2021 annual report that play-to-earn has been the most significant factor for continued growth in the industry. Some ways to make money in-game are:

Earning the game currency. This currency can be traded for other cryptocurrencies and cashed out for “real” currency.
Trading NFTs. NFTs such as land, homes, and art can be bought and sold in P2E games for good profits.
Minting new tokens and items. Some games allow you to create things such as pets and wearables, which can then be sold on the game marketplace.

Is Play-to-Earn worth investing your time and money in? P2E is a good choice if you love playing video games and have some time to spend playing the game. A common complaint about P2E games is that they are built to earn money and aren’t fun to play. Some games, like Axie Infinity, require you to purchase expensive items to play. Despite these legitimate grievances, the ability to make money playing video games is real and is happening right now. Given a choice between earning a living playing a game in the metaverse or spending 40+ hours a week working in a cubicle, I would choose the virtual world just about every single time!

How Much Can You Make in Cryptocurrency Airdrops

A cryptocurrency airdrop is a distribution of free cryptocurrency from a crypto project into a user’s wallet. Many new projects offer airdrops as a way to market their project. Airdrops are usually sent to users for holding a certain amount of coins/tokens or for completing simple tasks such as following a social media account, retweeting a post, or signing up for a newsletter. Airdrop values vary, but the average amount of money you can expect to receive is around $30. The most expensive airdrop was a token called minereum. It dropped in 2016. The lucky airdrop holders who held their 32,000 tokens would have been able to bank $448,000 at minereum’s all-time high of $14.00.

Airdrops are a great way to earn digital currency with minimal downside. Having to hold tokens for a period of time, or being required to complete easy tasks, is well worth little required effort if an airdropped coin could be worth even 1/10^th of what minereum holders were able to make.

How Much Money Can You Make Through Cryptocurrency Affiliate Programs

Cryptocurrency affiliate programs allow companies to incentivize affiliates by offering high fixed and commission fees for promoting the company’s products. Many affiliate marketing programs pay 5% to 50% commissions. Three of the most popular cryptocurrency exchanges that offer good affiliate payouts for referrals are:

Binance.com. This referral program offers up to 40% commission when your “friends” start trading.
Coinbase.com. This referral program pays $10 in Bitcoin for each new signee.
FTX.com. This referral program pays you between 25% – 40% of a new user’s fees.

Is affiliate marketing a good option to make money in cryptocurrency? Affiliate marketing takes time and effort to begin making commissions. A good understanding of successful sales techniques will also help due to the high level of competition. Affiliate marketing is generally easy to set up. Affiliate marketing can bring in an excellent income for those who stick with it and take the time to develop the required skills.

Exploring Earning Opportunities in Cryptocurrency

YouTube videos, and apps like Twitter and TikTok, may lead you to believe there is fast, easy money to make in crypto. Quitting your current job and starting a new life making a lot of money quickly through crypto seems like a no-brainer, right? Well, you may want to lower your expectations a bit. There is easy money to make, but life-changing money won’t come quickly for most people, at least not immediately. With a bit of time, your financial dreams can be reached, and while you are waiting for that day to come, you can take solace in knowing you are accumulating more crypto over time using any of the methods discussed here.

So, how much can you make in Cryptocurrency?

Continue reading to further your knowledge about cryptocurrency. Click here to learn about Polkadot – This Altcoin Aims to Take on Bitcoin and Ethereum.

*This article is for informational purposes only, not financial advice.