Home » Guide 6 Best ways of earning passive income crypto in 2020 1 6 Best ways of earning passive income crypto in 2020

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You are probably like us looking for new ways of earning income, and you want to find methods that work and are not scams. That’s why we have listed the current six best ways to earn passive income from crypto in 2020.

We at Go Cryptowise have spent some time researching looking into the most popular ways of earning some extra income from cryptocurrencies and listed our favourites.

Getting started mining Bitcoin and expecting to make a profit won’t be easy in 2020. At least not without a hefty investment cost and super cheap electricity where you live.

So you need to look into doing something different to actually earn some extra income from crypto these days.

So here are our favourites ways of earning passive money from cryptocurrencies in 2020.

6 great ways to start earning passive income from crypto

Basically there are just a few genuine ways of how you can earn passive income using cryptocurrencies today. And these below methods are our favourite ideas:

Lending: You lend out your cryptocurrencies and you get paid in return, easy difficulty and good returns, one of the easier ways of options on this list we think Margin funding: Here you also ‘lend’ out your funds for margin traders. Similar to lending as an easy option of getting started with Staking: Using this method you ‘stake’ your cryptocurrencies and you get a smaller portion of cryptocurrencies back in return. Bit more difficult but lucrative way of earning crypto from Masternodes: Similar to staking but you run a node that supports the blockchain network, and you get a higher return from this compared to staking. More complex but with higher returns, a great option for passive income Brave browser – earn BAT as an everyday user just browsing the internet. Definitely one of the easier ways to start with Brave browser – earn BAT as a published owning a website, blog, Youtube or Twitch channel. Easy to set up and could potentially be one of the better ways of earning high returns

How to get started earning passive income

The days when you could simply mine Bitcoin using your old computer at home are long gone.

So if you are looking into alternatives where you can earn money from cryptocurrencies besides trying your luck with day trading then we have created this guide for you.

Traditionally PoW (Proof of Work) has been the standard blockchain method where people could earn cryptocurrencies.

With PoW the miners secure the network by solving mathematical puzzles to confirm transactions to the network. And these miners then get rewarded by their effort.

This is how Bitcoin and many other cryptocurrencies work. And today for the regular cryptocurrency holder Bitcoin and their Proof of Work is not the best way of earning money from cryptocurrencies.

#1 Lending

So if you already have some cryptocurrencies. Maybe you have them stored in a wallet somewhere safe? That’s smart.

But what might interest you is lending those cryptocurrencies out to others and in return you get paid from the interest.

Two great options of earning money from lending are BlockFi and ETHLEND (read our interview with the Director of Marketing Brad from BlockFi here).

This is how it works – Lending with BlockFi and ETHLend

Sign up on their websites. For both BlockFi and ETHLend you go to their website and sign up. What lending means is that you ‘lend’ your cryptocurrencies to others. So you need to send them to a designated wallet from for example BlockFi or ETHLend. Send your coins to a designated wallet, make sure you’ve read the terms and conditions and that you feel ok with it. Then the processes differ but you essentially lend out your coins to others as an alternative funding method for businesses usually. Now you are pretty much done and you can start earning passive income from crypto-lending

“BlockFi Interest Account users can deposit their Bitcoin or Ether and earn up to 6% interest annually. Paid out on at the beginning of every month, the interest earned by account holders compounds, increasing the annual yield for our clients to 6.2%. This is an easy way for crypto investors to earn bitcoin while they HODL.”

Ethlend is a decentralised p2p lending platform that uses Ethereum smart contracts to connect lenders and borrowers. Securing a loan within minutes using blockchain technology. You as the lender set your own terms so interest is dependent on your agreed-upon terms. Another option is Salt Lending.

#2 Margin funding

Another option that you’ve got is the ‘margin funding’ feature from exchanges like Bitfinex and Bitmex. You basically fund (or lend) out your cryptos out for margin traders to use when opening long or short positions while margin trading. Make sure you do your research before.

Similar to lending it is an easy way to earn some extra passive income.

This is how it works – margin funding via OKEx

Users who want to margin trade on OKEx uses funds from a margin funding pool – call them margin traders Users who want to earn profit from their funds sitting on an exchange allocate their funds to that margin funding pool and get paid in return call them margin funders The margin traders then use the funds to open a long or short position and uses funds from the pool. When they close their position the funds are returned to the margin funders Another fairly easy way of making money from crypto

The funds kept in your exchange wallet can be used by other traders when traders open long and short positions when margin trading.

Margin trading basically means that a trader borrows money to speculate on the future price change of an asset like Bitcoin.

They can speculate that the price will go down (short position) or go up (long position). Traders who open long/short positions use real funds to ‘bet’ on that trade going their way.

And you ‘lend’ out your funds and in return, you get paid interest.

For example:

If a trader borrows USD to long BTC, the trader pays the funding cost to the funding provider in the equivalent value of USD at the agreed-upon USD funding rate. If a trader borrows BTC to short BTC, the trader pays the funding cost to the funding provider in the equivalent value of BTC at the agreed-upon BTC funding rate (find out more what margin trading is here)

Find out more information about margin funding at OKEx

#3 Staking your coins

As an alternative to PoW (Proof of Work), there is staking and PoS (Proof of Stake). It is what sounds like. You ‘stake’ your coins in a designated wallet.

And by staking coins you secure the blockchain and keeps it going. Staking coins is a bit easier than running a full Masternode.

You need to have your wallet with your cryptocurrencies connected to the internet and the blockchain at all times for it to work. A bit more complex setup but longterm this is one of our favourite ways to make money from crypto.

Especially now with cold staking being more common, we at Go CryptoWise think staking is a great way to earn passive income.

This is how it works

With PoS you stake your cryptocurrencies in a designated wallet connected to the blockchain. In most cases that means that this wallet needs to be connected to the internet 24/7 in order for it to work. Without it, you wouldn’t help to validate transactions on the blockchain and thus not get your rewards.

But there are new features in place for some PoS blockchain which is known as ‘cold staking’ and that means your wallet can be offline and not connected to the internet but you would still get your rewards.

In the Proof of Stake systems, creators of new blocks are created in a “pseudo-random way, depending on the user’s wealth, also defined as ‘stake’” (Hackernoon guide on Proof of Stake blockchains).

This is how you can get started with Proof of Stake

First, you need to decide on which coin you want to stake. We have compiled a list below of our favourite cryptocurrencies with staking available. Find more cryptocurrencies with staking options here. Then you need to find out what the requirements are? Usually, there’s a minimum requirement of how much you need to have in order to be able to stake. If using a computer: Traditionally for most PoS coins, you need a computer with a wallet connected to the blockchain all at times. So if you have a spare computer lying around this could work perfectly for that. Another option is to buy a Raspberry Pi or similar which costs about $50-70 and use that for staking. There are several guides on how to get started on the internet for that (guide here). If using a Virtual Private Server or VPS: If you don’t have a spare computer lying around, or concerned about the electricity costs then running a virtual server is another option. There are many services where you can run a private server on the cloud. Allowing you to set up a wallet on that private server and have it running 24/7 without a computer needed for you at home. Done, with the setup and your wallet connected to the Internet you are ready to get your returns and use staking for earning passive income from crypto (Only for some coins) Using a simple designated wallet. Some PoS or PoA (Proof of Authority) coins let you stake by holding the cryptocurrencies in a simple dedicated wallet and that’s it (maybe you need to click yes to staking or similar). Both Neo and VeChain allow you to do this for example.

5 of our top staking coins to pick in 2020

Here below we have listed some of the most popular coins which you can use for staking.

Do your research into each coin and select the one you like the most. Ask yourself again why this is a good coin to invest in.

You can find out where you can get hold of these coins in using Coinmarketcap and find a suitable exchange where to buy them here. Here we have listed the Best Proof of Stake coins of 2020.

#4 Run a Masternode

Another great option is running a Masternode. Which is a full node that secures the blockchain network?

It works like a traditional computer that needs to be running at all times to secure transactions and in return, you earn a higher amount of coins/tokens as a reward than traditional non-node staking.

Masternodes are more difficult to set up compared to staking. And you, for example, need your node to be up and running at all times, in order to connect to the blockchain and earn rewards.

Masternodes can be a bit tricker for non-techy users to get started, but it can definitely be a lucrative source of passive income.

This is how it works

Decide on which coin you want to run a Masternode for (you can use this guide to compare rates and types). It’s, of course, important to choose a coin that you like and believe in. You can ask yourself: Which one is going to be around in 12 months’ time? And then secondly: Why is this coin going to valuable in 12 months’ time? So do your research on the coin and people behind it first. Download the wallet to either a VPS or a local computer for example. Exactly like the staking process. When this wallet is synced to the blockchain and you have staked your coins, then you’re ready to start. Full guides on how to get started can be found on the internet, for example, guide here.

Which coins should I run a Masternode with?

Here below we have listed some of the most popular coins which you can run a Masternode with. Do your research into each coin and select the one you like the most.

We have written a guide to Masternode and some of the best coins to use for Masternodes – check it out here!

Find a full list of coins here. Masternodes are a bit more complex and require a bigger investment usually then staking coins without a Masternode.

But it is one of the best ways you can engage in to get higher returns.

1 ) DASH – 7.6% annual ROI



One of the most well-known options is DASH. Where you can earn up to 7% annually. The only problem is that you need to hold at least 1000 DASH coins, which costs about $82k. Find more information here Buy DASH at Binance and OKEx for example

2 ) ZCoin – 17% annual ROI



Another option is the privacy coin ZCoin. Where you can host your own node if you have the latest Zcoin wallet and you have already obtained your 1000 XZC. Find more information website and on their ZCoin guide – Buy ZCoin at Binance

Find the right exchange to buy staking and Masternode cryptocurrencies here

OKEx – OKEx is the second biggest exchange for cryptocurrencies when comparing trade volume (24h). OKEx offers fiat-to-crypto and crypto-to-crypto trading on more than 100 digital currencies. Binance – Binance is right now the leading exchange if calculated by volume (via Coinmarketcap). Binance offers perhaps the biggest selection of coins and one of our favourite exchanges Bit-Z – Bit-Z is one of the world’s biggest exchanges when it comes to trading volume and amount of supported coins, after Binance. Bit-Z founded in 2016 in Hong Kong. Bit-Z has established branches in 10 countries and regions including Singapore, Japan, and South Korea. Kucoin – Kucoin launched in 2017 and fairly quickly made a name for itself in the crypto world due to its early adoption of certain altcoins and their own coin called Kucoin Shares (KCS) which is a passive income coin, where you as a holder of KCS gets a percentage of the trading fees from the Kucoin exchange.

#5 Earn BAT as a browser user with Brave browser

“Users can earn $224 dollars per year using the Brave Browser” – Brendan Eich CEO of Brave (Reddit AMA).

If you haven’t heard of the Brave browser and the cryptocurrency running on the network known as the BAT token, then we urge you to check it out. It is a great way to earn passive income from browsing the web!

What Brendan and the team have done is definitely putting crypto on the map.

And providing a real use case. Imagine that over 500 million people use ad-blocking software today on their mobile and desktop devices.

This is, of course, creating problems for the advertisers, and it shows the genuine issue that people have with the advertising landscape. It’s everywhere, overexposed and we’re getting nothing out from it.

The solution to this is Brave browser. It allows you to earn money while browsing the internet as you normally do, but instead of the advertisers money going only to the publishers you earn as well.

This is how Brave works

Basically it means that while using the browser you go on browsing the web as you normally do, but when you view the infrequent ads from time to time you earn BAT in reward. Obviously Brave team gets their chunk from the pie, but you the consumer gets rewarded too.

Brave browser is faster too

Another benefit to the Brave Browser is that it’s fast. Really fast, and that’s thanks to the limited number of ads running on the websites. No more need for the ad blockers too to slow you down.

Helping you both increase speed and reduce the drainage to your battery, allows your devices to run for longer as well. It’s still a crypto startup so this feature hasn’t been released yet so keep a close eye on the Brave website for any news. But it’s still a very good browser that we bet you’re gonna love.

Helping you both increase speed and reduce the drainage to your battery, allows your devices to run for longer as well. It’s still a crypto startup so this feature hasn’t been released yet so keep a close eye on the Brave website for any news. But it’s still a very good browser that we bet you’re gonna love.

#6 Earn BAT as a publisher

Another option you have to earn money with the Brave browser is by signing up as a publisher.

If you today run a website, Youtube or Twitch channel then you can easily sign up as a publisher and start earning income via Brave. That means when a Brave user visits your website or channel you’ll earn rewards in return.

So if you already today have a website or channel running this might be an option for you to start earning income with Brave. A great way of you has good traffic to your website or channels of earning passive income from crypto.

This is how Brave Publishing works

Go to publisher.basicattentiontoken.org and sign up as a publisher. Verify the email that gets sent to you Set up your channel and verify it using one of the different options (depending on website or channel there are different options) Connect Uphold Important! So that you can receive and withdraw your rewards. If you don’t already have an account with Uphold you can easily do it via the Brave website using just a few clicks. You’re done and good to go!

Conclusion

There are different 6 ways how you can earn both passive incomes from crypto in 2020. And I myself use several of them myself. I even forget that stake crypto or use the Brave browser.

And earning money when you don’t even think about it, isn’t that great?

So it is important that you evaluate the different options and think about the ones that suit you the best. I myself earn BAT from a browser user and a publisher and I also stake some coins. That works great for me.

But what would work the best for you?

Those are some of the best ways of earning passive income from cryptocurrencies that you can do right now. Check our Guides section for the best tips on crypto!

We hope that you found this guide helpful. Please share it if you did. If you have questions or comment please feel free to leave them here below and we will try and answer them as soon as possible. In the meantime good luck and be safe.

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