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How to Make Money with Cryptocurrency?

Wondering how to make money with cryptocurrency (crypto)?

In this post, I’ll share 4 valid and legitimate ways which I’ve used to make money with crypto. I’ll list down the pros, cons, and personal tips for each of them.

Other than that, I’ll also include 5 other ways that other people are using to make money with crypto.

Table of Contents

How to make money with cryptocurrency?

Here are 4 ways that I’ve used to make money with cryptocurrency.

1. Buy and hold (then sell)

This is the most well-known way to make money with cryptocurrency. Most probably because it is simple and easy to start.

What you need is to buy your crypto such as Bitcoin and hold it. When the price increase, you sell the crypto and you earn a profit.

Here is a rough example of how I made money using the buy-and-hold method.

I spent RM2,500 to buy 0.1 Bitcoin (BTC) at RM25,000 BTC in early 2020. Fives months later, when the Bitcoin price jumped to RM50,000 BTC, I sold the 0.1 BTC for RM5,000.

You may refer to the Bitcoin price chart below.

Make money from cryptocurrency through buying Bitcoin at RM25,000 BTC and then selling it at RM50,000 BTC.
Buy Bitcoin at RM25,000 BTC and sell it at RM50,000 BTC

So, I made a profit of RM2,500.

Below are the pros and cons of making money from crypto through the buy-and-hold method:

Pros

  • Simple
    Less effort is needed, mostly just buy and hold until you see the selling opportunity.
  • You can start immediately
    All you need is to register for a crypto account, buy your crypto and wait for the opportunity.
  • Potentially giving huge returns
    Generally, if you are willing to hold your crypto for a few years, you could have a higher return from your crypto.

Cons

  • Require a longer investment horizon
    Depending on the crypto market, it could take some time before you can see the selling opportunity.
  • The possibility of the crypto becomes no value
    As cryptocurrency is always associated with high risk, only invest the amount that you are willing to lose.

Personal tips:

  • Be an early crypto adopter.
    • Don’t wait or delay but take action now.
    • Buy your first crypto. See and feel it yourself.
    • Be in the ups and downs of the crypto market. All these shall make you a better crypto investor.
    • You can read and listen to many crypto stories but the best and most useful and genuine is your own crypto story.
  • Use the DCA method
    • It is never easy to predict the right time to buy crypto.
    • Many suggest using the Dollar Cost Averaging (DCA) method to improve returns on investment.
  • Invest in long term
    • When you invest for the longer term, say 5 years, you have a better opportunity to optimize your returns.
    • as crypto prices jump up and down, sometimes, it is also possible to make good money within weeks or months.
  • Keep yourself updated with the crypto news
    • Utilize crypto exchange tools such as price alerts so that you won’t miss out on the buy or sell opportunity.
  • Invest the amount you are willing to lose
    • As cryptocurrencies are highly volatile, only invest what you can afford to lose.
  • Learn how to do your own crypto research
    • Become an informed and educated crypto investor by performing your own crypto research.

2. Making money from the cryptocurrency referral program

Something unique about digital platforms such as crypto exchanges is, that they usually come with a referral program. This is where you get a unique referral code or referral link when you register for the crypto platform.

When your friends or family register through your referral code or referral link, you’ll receive an incentive. Usually, the rewards come in the form of crypto (such as Bitcoin) or other coins which you can sell for cash.

One example is Luno’s referral program where you get to earn RM25 in Bitcoin when your friend register and enter your code.

Make money through crypto exchange's referral program.
Earn RM25 in Bitcoin through Luno’s referral program

And below is a screenshot of some of the Bitcoin rewards I received from the referral program.

Received RM25 in Bitcoin for each friend I referred to Luno platform.
Received Bitcoin rewards from Luno’s referral program

If I want, I can sell the Bitcoin rewards and withdraw the cash.

Here are the pros and cons if you want to make money with cryptocurrency through a referral program.

Pros

  • Earn free cryptocurrency
    • You get to grow your cryptocurrency investment without having to spend your own money.
  • Highly effective
    • Most of the referral program offers rewards for you (referral) and your friends (referee).
    • It is a win-win situation where both of you get to receive crypto rewards.
    • Since your friend most probably wants the rewards, this increase the possibility for him to register through your referral code.
  • Simple and Easy to start
    • Usually, the referral script is already prepared by the crypto platform.
    • You can just share on social media, emails, or other messaging apps.

Cons

  • Require you to share your referral link or referral code
    • Some of you might reluctant to promote to friends and family.
  • The rewards can change from time to time
    • The referral program’s terms and conditions can change from time to time.
    • Such as reducing increasing or reducing the amount of the rewards.
    • And the platform has the right to remove the referral program too.

Personal tips

  • Be an early bird
    • You can maximize the profit of a crypto referral program by registering for the platform as early as possible.
    • As an early adopter, you have a higher chance to get more referees.
    • And in some cases, the rewards are higher when the platform just starts to promote its service.
  • Promote the platform that you love
    • Register, try, and use the platform yourself.
    • Learn and get familiar with the platform before start promoting it to others.
    • Include your genuine and helpful thought about the platform. This would justify the reasons for others to register for the platform.
    • don’t promote for the sake of making money.

3. Earning commission from the cryptocurrency affiliate program

If you are an influencer or content creator, you have another option that is similar to the referral program.

It is a cryptocurrency affiliate program.

This is where you collaborate with the cryptocurrency provider to promote their platform to your audience. When your audience registers through your referral code or referral link, you receive a commission.

Usually, your audience also receives a reward, or incentive or enjoys a certain discount when signing up through your referral code or referral link.

Below is a screenshot of an affiliate program from Coinbase, a leading crypto exchange.

Make money from cryptocurrency through crypto affiliate program.
Earn commission through the Coinbase affiliate program

Alternatively, you can take a look at my partnership with Luno Malaysia where my readers get free RM50 in Bitcoin when registering through my Luno promo code.

Pros

  • Potential of passive earnings
    • You have the potential to receive passive earnings through the content that you’ve created.
    • For example, you’ve created a video on a crypto platform and included your referral code in the video.
    • It is possible for your to keep receiving commissions from the one video you created throughout the partnership.

Cons

  • Might require huge followers for a significant earning
    • Generally, the more followers or readers you have, the higher the potential for a good affiliate income.
  • Require continuous effort
    • You’ll need to keep promoting your content to reach new audiences.
  • Irregular earnings
    • The income from affiliate marketing is very much affected by cryptocurrency prices.
    • Viewers are positive and more ready to register when the crypto market is bullish.
    • So, expect minimal earnings when crypto prices are moving downward.
  • Require partnership agreement
    • Your earnings are dependent on the partnership agreement (commission rate, other restrictions).
    • When the partnership ended, you no longer receive the commission from the crypto company.

Personal tips

  • Share genuine and helpful content
    • I find that sharing genuine and helpful content helps to convince the audience to register for a platform.
    • Readers can sense it when you share based on your own experience.
    • It is also best to include both the pros and cons for the audience’s consideration.
    • It looks fake if the content only mentions the good things.
  • Promote locally authorized platform
    • Each country has its own rules and regulations on digital assets (for example, the Securities Commission Malaysia).
    • I recommend promoting locally authorized platforms.
    • This is to avoid issues where your audience fails to log in to the unauthorized platform due to being blocked by the local authority.

4. Participating in the crypto contest

You can also make money with cryptocurrency by participating in crypto contests organized by crypto platforms.

Some of these crypto contests can be easy to join, such as

  • completing a trade.
  • successfully referring a new friend to the platform.
  • spotting the crypto official advertisement.
  • answering simple crypto-related questions on the platform’s social media account.

Other contests are more challenging such as

  • based on trade volume.
  • writing an essay on certain topics.

The contest prize can be in the form of cryptocurrency, cash, or other related product vouchers.

Here are the pros and cons of making money by participating in cryptocurrency contests.

Pros

  • Easy to participate
  • Require no or minimal investment

Cons

  • Lower winning chance
    • It might not be easy to win a reward.
  • Require you to be aware of the contest announcement
    • Some platforms only publish content on their website. So, you need to visit their website frequently.
  • Might require some effort or investment to improve the winning chance
    • This is true for contests that are based on trade volumes.

Personal tips

  • Improve the winning change by putting in extra efforts
    • Although this does not guarantee a reward, your extra efforts could improve the winning opportunity.
  • Targeting a contest that’s worth the effort
    • Put in the effort for the rewards which you think are worth it.

Other ways to make money with cryptocurrency

Here are 5 other ways you can generate money from cryptocurrency.

Although I have not tried out these options yet, I know people who are making good money from these methods.

1. Stacking your crypto

The concept of crypto stacking is similar to fixed deposits. You commit your digital assets with the stacking platform. In return, the platform pays you a certain percentage as interest.

Generally, there are different ways of crypto stacking. Here, I’ll share the common crypto stacking available to the general crypto investor, that is stacking through a crypto exchange.

Below is a screenshot from Crypto.com on its stacking rewards.

Some of Crypto.com's staking reward rates.
Crypto.com staking rewards

Here are the pros and cons of crypto stacking for your consideration.

Pros

  • Easy to start
    • Usually, the crypto exchange requires an affordable amount of a certain amount of crypto such as Ethereum.
    • You just need to set the stacking and monitor the returns.
  • Great alternative as recursive and passive earnings
    • Yes, crypto stacking has the potential to give good returns, especially for investors holding a substantial amount of crypto.
    • The annual percentage yields are higher than those offered by traditional banks.

Cons

  • Only offered by certain crypto exchange
    • At the moment, not many crypto exchanges are offering stacking options.
    • Two of the famous one is Coinbase and Binance (both are not registered with SC Malaysia).
  • Crypto price falling
    • If the digital assets that you staked suffer a huge price drop, this could outweigh the interest earned.
  • Lockup period
    • When you staked your coins, usually, there’s a minimum duration requirement.
    • During the lockup period, you can’t sell your coins.
  • Hacker risk
    • If hackers attack the exchange, you risk losing your coins too.

Personal tips

  • Choose a reputable crypto exchange
    • Preferably a trusted and locally approved crypto platform.
    • At least, when something turns wrong, you can get helps from the local authority.
  • Be reasonable and realistic
    • If something is too good to be true, it could be too good to be true.
    • When some offers are too good (such as very high interest), I would start to be skeptical.
    • It’s good to avoid being greedy.
    • Do your own research.
    • Opt for realistic returns.
  • Do not put all your crypto on one platform
    • Separating your crypto may reduce your risks.
    • When an undesired thing happens to your crypto in platform A, you still have your crypto in platform B.

2. Trading Cryptocurrency

Do you know that there are people making good money by trading cryptocurrency?

These experienced crypto traders buy and then sell the crypto at a profit on the crypto exchange.

Make money by trading cryptos on crypto exchanges such as Luno's Exchange.
Luno’s Exchange

Below are some pros and cons of cryptocurrency trading worth knowing.

Pros

  • You can trade 24/7
    • Unlike traditional stock exchanges where trading is opening hours, the crypto market is in motion 24/7.
    • You can trade 24 hours a day, seven days a week, from anywhere.
    • This also means you can have your full-time day job and trade crypto at night or at the weekends.
  • Minimum capital requirement
    • You can start trading cryptocurrency with a small amount.
  • Potential for good earning
    • Professional and experienced crypto traders have a higher potential to make good money from crypto trading.
    • They see crypto volatility as a great opportunity for a big profit.

Cons

  • High Risk
    • Cryptocurrency is highly volatile (price climbing and plummeting in minutes) and risky (hackers).
    • You must know the risks you’re taking.
    • Only trade the amount you’re willing to lose.
  • Require experience and strategy
    • Most traders lose money from crypto trading in their early days of trading.
    • Successful traders are those who learned from their own (and others) mistakes and have a strategy for entering each trade.
  • Irregular income
    • The income could be dependent on the crypto market.
    • Generally, more people are buying when the crypto market is moving up.
    • So, less trading opportunity when the crypto market is going downward.

Personal tips:

  • Allocate a certain amount of money for trading
  • Don’t be greedy
    • Since the crypto market is available 24/7, remember to avoid overwork and burnout.
  • Have a strategy and stick to it
  • Keep learning and improving your crypto trading skills

For those of you who wish to know more about crypto trading, you may want to read this write-up on how a guy becomes a professional crypto trader.

3. Crypto Crowd Mining

Cryptocurrency mining is the process that cryptocurrencies such as Bitcoin use to generate new coins and verify new transactions on their peer-to-peer network (aka blockchain).

Back in 2009, you can mine Bitcoin using a home computer. As Bitcoin’s blockchain grows, now miners are combining their resources and effort (using a large network of super-powerful machines and software) to improve their opportunity of getting crypto rewards.

But, it is still possible to mine some of the coins especially newer coins using normal computers. I had not tried this option as I have not done sufficient research on crypto mining.

Some miners also allow you to participate in their mining effort by registering and opening an account with their mining platform.

You can choose a mining plan that suits you. Next, you deposit your fund. Finally, the mining rewards (in coins) will be transferred to your account based on your plan.

An example of a crypto crowd-mining platform is Hashing24.

Make money from cryptocurrency through crypto mining.
Make money with crypto mining on Hashing24

You make money from the payouts or bonuses based on the plan that you’ve chosen.

Below are some advantages and disadvantages of making money from joining crypto mining platforms.

Pros

  • Affordable
    • Crowd mining gives you the opportunity to mine crypto without the need to purchase the equipment or software yourself.
    • Comes with multiple plans or packages. You may choose the one that you feel comfortable with.
  • Easy to start
    • To get started, you just need to register for an account and deposit your money.
    • You are not required to have the technical knowledge involved.
  • Potential for good returns
    • Most of the crowd crypto mining platforms offer daily payout.
    • Over the long run, these payouts can turn into a significant amount of money.

Cons

  • High Risk
    • While crypto crowd mining is not necessarily a scam, many crypto crowd mining services are frauds.
    • This means you don’t get the returns promised by the provider.
    • And most probably you won’t get back your initial deposits too.
    • It is also possible they misuse the personal data you entered when registering and hacking your crypto or financial accounts.
  • Earnings are not guarantee
    • Earnings are not guaranteed as it depends on:
      • mining difficulty
      • crypto price
      • network difficulty
      • block rewards
  • You don’t have control
    • Since you don’t own the equipment or software, you totally have no control over the whole mining process.

Personal tips

  • Do your own research
    • You must perform detailed and thorough research before registering for any crypto crowd mining services.
    • Learn to identify reviews that you can trust.
  • Opt for reputable crypto cloud mining services
    • This will reduce the fraud opportunity.
    • Although some of these websites have long proven records, it is still possible for fraud to happen.
  • Know the risks you’re taking
    • Only put in the amount you’re willing to lose.

4. Investing through a Robo-advisor

If you want to make money from cryptocurrency but you are holding it back due to its volatility, you may consider investing in cryptos through Robo-advisor.

Robo-advisor platforms such as StashAway offer investing in blockchain as part of their thematic portfolio under Technology Enabler.

What you need to do is to register for StashAway, and start investing in the Technology Enabler theme.

Make money by investing in blockchain through Robo-advisors such as StashAway.
StashAway’s thematic portfolio invests in blockchain

Since the theme consists of Exchange Traded Funds (ETFs) from various technologies such as Artificial Intelligence and Robotics, you get to reduce your risks.

Personally, I think this is a great option if you want to try out cryptocurrency but is concerned about its high volatility.

Below is a list of the benefits and drawbacks of making money with cryptocurrency by investing through a Robo-advisor.

Pros

  • Investing in cryptocurrency without having to buy the coins yourself
    • The Robo-advisor platform manages everything for you.
  • Require less monitoring
    • Robo-advisor usually comes with artificial intelligence technology that works on your portfolio 24/7.
    • Including portfolio auto-balancing (if necessary).
  • Affordable
    • Require minimal initial investment amount.
    • Lower fees.
  • Lower risk
    • A more diversified portfolio reduces investment risk.

Cons

  • Require longer investment duration
    • It is recommended to invest in the longer term to maximize returns.
  • Less flexibility
    • You can’t pick the specific coins you wish to invest in.

Personal tips

  • Start with a small amount
    • Try it out for a few months to see if the investment fits into your financial planning.
  • Monitor the performance
    • Don’t rely 100% on the platform, maximize your profit by monitoring the performance yourself.
  • Invest for the longer term
    • Allow a few years for a better return on investment.

(Register for StashAway through my StashAway promo code to enjoy 50% fees deducted for the first RM100,000 invested for 6 months.)

5. Investing in cryptocurrency stocks

Another way to make money with cryptocurrency is by investing in cryptocurrency stocks. This method allows you to invest directly in cryptocurrency-related companies.

Some of these companies are:

  • Coinbase Global, Inc. (NASDAQ:COIN) – the first publicly traded cryptocurrency exchange.
  • Canaan (NASDAQ:CAN) – designing and producing low-energy but super powerful machines for crypto mining.
  • PayPal (NASDAQ:PYPL) – supports cryptocurrency within a digital wallet.
Investing in crypto-related stocks such as Paypay.
Paypal’s stock price

Here are some pros and cons of investing in cryptocurrency stocks:

Pros

  • Potential for high returns
  • High flexibility
    • You can pick the individual stock you wish to invest in.

Cons

  • High-risk investment
    • High risk comes from crypto’s volatility and the stock market itself.
    • Handle with extra care.
  • Require fees
    • Require higher fees and other expenses compared to Robo-advisors.

Personal tips

  • Not suitable for new investors.
    • Too risky.
    • Only jump in if you know what you are doing.
    • Although investing in crypto stocks offers great returns, it also comes with high risk.
    • So, you must know the risks you are taking.
  • May consider index fund instead of individual stocks
    • May reduce the risks.
    • A more diversified approach.

Other than the above, I’ve also come across other ways to make money with cryptocurrency, such as:

  • Non-fungible token (NFT)
  • Decentralized finance (DeFi)

Once I have done sufficient research on them, I shall update this post.

Do subscribe to my blog so you won’t miss out on new posts published.

Final thoughts

With the above sharing, I hope you are aware of some of the ways you can make money with cryptocurrency.

When trying to make money with cryptocurrency, do be aware that there’re a lot of crypto scams out there. Thus, you must do your own research before you jump in and only invest the amount that you’re willing to lose.

Which of these cryptocurrency money-making methods do you love most? Have you come across other crypto money-making methods? I wish to know.

Lastly, if you want to register for crypto exchange, use my Luno promo code to get RM50 in free Bitcoin.

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