Making money with crypto? You’ve probably read about it online; young people who have become millionaires trading crypto like Bitcoin.
Although Bitcoin is the most popular, it is certainly not the only cryptocurrency with which money is made. Cryptos are hip, they are relatively new (compared to stocks) and offer opportunities. Precisely because it is all still on the rise and the current financial system is changing forever, you can earn money with this.
Besides those crypto millionaires, there are also many losers. Often those are the people who got into it because it was so hyped, but who actually had no idea what they were investing in. Therefore, a balanced article that tells you how to make money with crypto! How to get started with crypto
To make money with crypto, you first need a place to trade it. You can easily do this via the Dutch Bitvavo. Creating an account is free and via the button below you pay nothing for your first €1000,- trade. What are crypto and blockchain?
You’ve probably heard of Bitcoins; a digital currency encoded with blockchain technology. This is a way to store digital data in a staggered manner without using one central point.
This makes it more difficult to hack than, for example, a regular bank (which does have one central point or server). Where DOS attacks increasingly cause banks to shut down, the crypto coins are less likely to suffer from this.
Decentralization also has the advantage that it costs less. You may have wondered why Rabobank has such a gigantic office in every Dutch city… An office of the Bitcoin is nowhere to be found 😉.
It is therefore no wonder that blockchain technology emerged especially after the crisis of 2008 . During that crisis, many people lost their money, partly because they were dependent on central financial points such as banks.
>> Understanding Crypto is easiest by using it. Therefore, create your free account with the crypto trading platform Bitvavo.
Beyond crypto as a financial resource, blockchain technology is now also used for NFTs (non-fungible-tokes) and decentralized apps. If you don’t know what those things are, don’t worry, crypto is something you slowly get into and learn about step by step.
So much for the explanation of cryptocurrencies. To make money with crypto, other things may be more interesting; namely which cryptocurrencies there are. The different types of cryptocurrencies in 2022
If we would only trade in the Bitcoin, the fun is quickly gone. It may be the best-known coin, but not so much the easiest to trade. It will not have escaped your notice that Bitcoin was valued around 69,000 dollars per coin last year, but it has since calmed down a bit.
It is important to mention that when it comes to the price of Bitcoin, people seem to have a short memory. Whatever the price, there are always people who say it goes to zero. However, the past 10 years show nothing but an upward trend.
If you look at this chart like this, it seems as if the price of Bitcoin for 2017 did not move at all. However, nothing could be further from the truth. Only due to the exponential growth of recent years, it is no longer visible on the graph.
To give you an idea. Anyone who bought Bitcoin for €1000,- in 2012 is now a millionaire. But anyway, that is of course of no use to you as a reader of this article. After all, we cannot go back in time. However, you can learn something important from this. Namely, why the price of Bitcoin goes up at all over the years. Why is the price of Bitcoin going up?
The price of Bitcoin (and this applies to all crypto) has everything to do with scarcity, supply and demand.
Scarcity because in total only 21 million Bitcoin will be available. This is set out in the code and is not customizable. When more people want Bitcoins to secure their money, as a means against inflation or simply as an investment, the demand for the currency goes up. That with a constant supply of those maximum 21 million coins and you see the gigantic price increase as it is now.
What makes it so difficult to trade in Bitcoin is that the currency has become very dependent on hypes among ‘normal people’, and these are not always easy to gauge. People do not buy coins because of their development, but because they have heard it from someone else. A big trickle of mass psychology .
Although it should be noted that this status has changed considerably in 2022. Many more large investment funds and billionaires are now also diving into bitcoin and giving it a big boost.
You’ve probably heard something about Elon Musk’s Bitcoins !
At the same time, there are also many other cryptocurrencies. In fact, there are more than 10,000 registered coins. Of course, not all of them are equally relevant (some are literally worth nothing).
Good to know is that the crypto coins that are not Bitcoin are called alt coins. This stands for alternative coins. After all, Bitcoin was the first currency on blockchain technology, the rest came later.
If you want to make money with crypto, you can certainly take a look at the largest crypto coins. These 30 largest coins, together with Bitcoin, account for 95% of the total market value. These are widely traded or have great potential.
Binance Coin (BNB)
Bitcoin Cash (BCH)
Stellar Lumens (XLM)
USD Coin (USDC)
Wrapped BTC (WBTC)
Theta Network (THETA)
Crypto Chain (CRO)
Bitcoin SV (BSV)
You may be familiar with some of the above coins. They regularly appear in the news!
Reason for investors to look at alt coins, instead of Bitcoin, is because a lot of growth is still possible here. Bitcoin will not shoot up 1000% so quickly (that is an x10 of your investment), with smaller coins this is much easier to achieve.
At Bitvavo you will find the 150 most popular alt coins in which you can easily invest via Ideal. Creating an account is free and over the first € 1000, – you pay no trading costs.
There are more than enough opportunities to make money with crypto. In the next piece we are going to look at how you can make money with crypto. This can be by trading it, but there are certainly other ways to think of. 1. Making money trading crypto