1. Speculating on cryptocurrencies:
The thrilling game of speculating on cryptocurrencies is the most common way to make money in the crypto world, with the core idea being to buy low and sell high, profiting from price fluctuations. It's exciting, but the risks are high.
1. Short-term trading: Quick in and out. Short-term trading involves closely monitoring candlestick charts to capture short-term fluctuations. For example, buy Bitcoin at $60,000 and sell at $65,000, making a few thousand in profit. You need to understand technical indicators (like RSI, MACD) and market sentiment. A friend of mine chased high prices in 2021, only to see the price crash and suffered huge losses. Short-term trading requires discipline; set stop-loss orders and avoid greed.
2. Long-term holding: Zen-like HODL. Long-term means buying coins and holding them for a few years until they double in value. Choose mainstream coins like Bitcoin or Ethereum, or potential projects like Solana or Polkadot. In 2018, when Bitcoin was at $3,000, a friend bought 5 coins; by 2021, they rose to $60,000, making a 30x profit. For long-term holding, research the project's white paper, team, and community; avoid buying 'worthless tokens.'
3. Margin trading: High risk, high reward. Margin trading involves borrowing money to speculate on cryptocurrencies, amplifying both profits and losses. With 10x leverage, if the coin price rises by 10%, you make 100%; if it falls by 10%, you get liquidated. Binance and OKX support margin trading, but beginners should avoid it; 9 out of 10 people lose when trading on margin.
Cryptocurrency trading Tips:
Don't go all in; keep cash to manage risks.
Stay updated on news; Federal Reserve interest rate hikes and regulatory policies will affect coin prices.
Don't trust 'guaranteed profit' signal groups; they're mostly scams.
2. Mining:
Using computing power to 'print money' through mining involves using a computer to help the blockchain verify transactions for rewards. It sounds impressive, but the barriers to entry are not low.
1. Bitcoin mining: Exclusive for big players. Bitcoin mining relies on specialized mining machines (like Antminer S19), which are costly (machines cost tens of thousands, and electricity isn't cheap). I know a mining farm owner in Sichuan who made millions in 2017, but now with rising electricity costs and intense competition, it's hard for individual players to enter.
2. PoS staking: Lazy person's mining for newcomers. Ethereum 2.0 uses a PoS mechanism; by staking ETH to the network, you can earn 4%-8% annualized returns. Binance and Kraken offer staking services; it's simple and suitable for lazy people. However, choose large platforms; safety comes first. Mining Tips:
Calculate costs carefully; consider electricity and hardware expenses.
Be wary of 'cloud mining' scams, as many take the money and run.
3. DeFi:
Decentralized finance (DeFi) is a new favorite in the crypto world, equivalent to using blockchain for banking and exchanges, with many ways to earn high returns but also significant risks.
1. Liquidity mining: Be a 'bank.' By depositing coins in Uniswap or SushiSwap, you provide liquidity for trading and earn fees and token rewards. During the DeFi boom in 2020, annualized returns were over 100%; now, 10%-30% is more common. However, many projects are unreliable, and the risks of exit scams and hacks are high.
2. Lending platforms: Earn interest on deposited coins. Aave and Compound allow you to earn interest on your deposits (5%-15% annualized for USDT) or borrow coins to speculate on price differences. Be cautious of price fluctuations, as you might be liquidated. DeFi Tips:
Use hardware wallets (like Ledger) to protect your assets.
Test new projects with small amounts; don't invest your entire portfolio.
Watch out for gas fees; high costs can eat into profits.
4. NFTs:
Speculating on digital collectibles NFTs (non-fungible tokens) are unique digital assets, such as artworks and in-game items. In 2021, Beeple's NFT sold for $69 million, going viral.
1. Speculating on NFTs: Buy low and sell high. Look for potential projects, buy NFTs at low prices, and sell when they appreciate. For example, Bored Ape was a few hundred dollars early on, then rose to hundreds of thousands. When choosing projects, consider the team, community, and scarcity; the risk of bubbles is high.
2. Creating NFTs: Become an artist. If you can draw or make music, you can sell NFTs on OpenSea. I once saw an artist sell pixel art NFTs for thousands of dollars. Marketing and community are very important. NFT Tips:
Check the project's background; don't buy 'worthless NFTs.'
Be aware of platform fees; OpenSea charges 2.5%.
5. Airdrops and IDOs:
Opportunities to make easy money
1. Airdrops: Get free tokens. Projects distribute free tokens for promotion. In 2020, Uniswap airdropped 400 UNI tokens, worth thousands of dollars. To receive airdrops, you need to engage on Discord and Telegram and complete tasks (like sharing or signing up). But now there are many worthless tokens, so be careful of being scammed. 2. IDO: Participate in a new coin launch. IDO is the initial offering of a new coin, similar to an IPO. In 2021, I participated in an IDO where I bought tokens for $1, and they rose to $10 upon listing. However, the risk of a price drop is high, so choose projects carefully. Tips for airdrops and IDOs:
Follow platforms like Polkastarter and Binance Launchpool.Don't click on unclear airdrop links; protect yourself from scams.
6. Blockchain games and the metaverse:
You can earn while playing; GameFi and the metaverse are new trends where you can make money by playing games or speculating on virtual real estate.
1. Blockchain games: Earn while playing. Axie Infinity and The Sandbox allow players to earn tokens through activities like raising pets and fighting monsters. In 2021, when Axie was trending, some people earned thousands of dollars per month. However, the initial investment is high (you need to buy three pets), and token prices are very volatile.
2. Metaverse real estate: Speculate on land. Buy virtual land in Decentraland; land prices depend on location. A friend of mine bought land for $2,000 in 2020 and sold it for $20,000 in 2022. In the early days of the metaverse, speculation risks are high. Tips for blockchain games and the metaverse:
Choose projects backed by well-known companies or active communities.
Experiment with small amounts; don't invest your living expenses.
7. Pitfall avoidance guide:
In the crypto world, there are many opportunities to get rich, but also many traps. Here are a few tips to avoid pitfalls:
Don't go all in; the volatility is high, so keep cash on hand to mitigate risks.
Be wary of scams: There are many worthless tokens, fake airdrops, and phishing websites; protect your private keys.
Do your homework: Before investing, read the white paper, check the team, and browse the community.
Control your impulses: FOMO (fear of missing out) can lead you to buy at high prices.
