Profit with cryptocurrency – Is that even possible in 2020?
Unlike the interest market, there are no secured profits with cryptocurrencies, but it is still possible to earn an income.
Large investors in the market buy during periods of low prices and sell during periods of high prices. This method is called the buy low & sell high method. However, this is only one way to make profits with crypto currencies. In this sense, it does not matter that there is no guarantee of returns in the crypto world, because there are still ways to earn a passive income with crypto currencies. More about this in the following.
A Passive Income with cryptocurrencies via Masternodes
If you want to achieve higher payouts, the operation of a masternode is an alternative to staking. In contrast to staking, the masternode also performs administrative tasks. For example, checking private/instant transactions or voting for software updates. Staking, on the other hand, involves more than one provider.
A masternode is a full node on which a copy of the entire ledger of the underlying coin is stored and made available in real time. In this way it supports the network.
To operate a masternode, you have to meet certain criteria. For example, the computer on which the node is operated must be online and connected to the network 24 hours a day, seven days a week. A certain amount of coins is also required to participate.
The top 15 project DASH is a popular coin that offers the operation of masternodes. A 6.45 percent annual return is distributed to the operators. However, the requirement is to have over 1000 DASH at their disposal, which at the current rate of $99.75 corresponds to an investment of $99,750.
The bottom line is that the payout for operating a master node is higher than for staking, but the investment is also much greater.
But there are a lot of smaller coins than DASH which masternodes are affordable, so single persons can run them at home at actually earn profits in the respective coin. When the price of the coin rises this can actually be a highly profitable thing, and all passively, just from home. What you’ll need is a rented masternode vps, a virtual server is the most cost-effective choice in this case.
The following coins are interesting regarding masternodes this year: Check out
Some of them even have a 1-click installer, which makes the whole setup really handy. It really depends on your budget and the current price of the token if you might be able to afford hosting a masternode or not. So you need to check those details out first.
PoS – Proof-of-Stake – Staking with Cryptocurrencies
Users can store their coins for a certain period of time. This means: lock them away and thereby generate a passive income. This is the so-called proof-of-stake consensus mechanism. There are also variations of this, but they work in a similar way.
By locking the coins away, the users contribute to network security and receive a certain return on investment. How much this is and how often it is paid, as well as the type of currency, depends on the respective projects and varies accordingly. The choice of these projects is quite large, so it should be easy to find the right one.
The difference to mining is that in proof-of-stake new blocks are generated by holding coins in a staking wallet. In mining, on the other hand, the coins are generated by providing hardware and computing power.
In proof-of-stake, coins are sent to the wallet and you choose how many coins you want to deposit. The reward depends on the amount of deposited coins and also the chance to get a block reward.