Six ways to make money while cryptos remain in a bear market – Moneycontrol





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While extreme volatility and price declines are typically associated with bear markets in which investors tend to lose their savings, a downturn can also be used as an opportunity to build wealth in the long term.
Here are seven ways to earn consistently in the crypto market and build wealth even in a bear phase.
1. STAKING CRYPTOCURRENCIES
Staking is a simple way of increasing your assets if you already own some and do not intend to sell them.
How does it work?
Staking requires you to lock your crypto tokens with a platform to earn interest on them. Staking platforms often allow both fixed and withdrawable staking.
Centralised exchanges such as Binance, Crypto.com, Kucoin, and Bybit allow staking of tokens. Additionally, decentralised platforms including Beefy Finance, ACryptoS, and DEXs like Pancake Swap are available.
Who should stake tokens?
Staking is a must for anyone who already owns tokens and does not want to sell them. Staking offers the opportunity to effortlessly build your assets and then sell them when prices increase.
How much can you earn through staking?
The wealth that can be gained from staking depends on two variables: the type of tokens staked and the lock-in duration.
Staking Tether (USDT) will probably result in a 2 percent annual percentage rate (APR) and won’t make you rich.
On the other hand, you can easily earn more than 100 percent APR if you stake some of your volatile coins for a few months.
2. YIELD FARMING
From an investor’s point of view, yield farming is comparable to staking. If you currently own crypto assets, this strategy can be more appealing.
How does it work?
Liquidity mining is sometimes referred to as yield farming. It is a passive method of making money by adding to liquidity pools. In a nutshell, it is the practice of receiving tokens or fees in exchange for locking up your cryptocurrency.
Yield farming platforms such as Beefy Finance, Autofarm and Single Finance are available online.
Who should do it?
As with staking, yield farming is for those who own cryptos and do not want to sell them. A smart long-term approach is to purchase cryptos in a bear market, increase them through yield farming, and then sell them in the next bull run.
What are the potential gains?
Again, it depends on the liquidity you offer. If you invest in a single common asset, you can see annual returns in single digits. The advantage, however, is that there are no upper limits.
You can choose liquidity pairs that print more than 1 percent per day, including ones with really high risk.
3. CRYPTO LOANS
Another way of putting your resources to work in a down-market is to lend.
How does it work?
Crypto lending is exactly what the name implies: You lend your accessible assets to someone else for a predetermined time. You get paid an agreed-upon interest rate for the period of the loan.
Crypto lending is possible on popular CEX and certain decentralised platforms.
Who is it for?
For those who already own crypto assets, the strategy makes more sense than staking and yield farming. Yet, if you choose stablecoin lending, you can also buy coins and then lend them out.
Can you earn enough?
Usually, the returns are less than that of staking and yield farming. Despite this, the market is highly erratic and times of tremendous demand can result in some hefty gains.
4. AUTOMATED GRID TRADING BOTS
Trading through bots is a riskier bet.
How is this done?
Grid trading bots benefit from market fluctuations. The bot will always sell a portion when the price goes up a little and buy a portion when the price goes down a little, as long as the price stays within a chosen range.
A market that fluctuates sideways is ideal for a grid bot. Some platforms, however, also provide specialised bear market bots.
Who should be trading through bots?
Everyone can do it because automated grid trading bots are simple to set up. You don’t need to have any crypto assets to trade using bots.
Are the earnings good enough?
The earnings depend on a variety of elements including volatility, market development, and the coin chosen. But under the appropriate circumstances, it is not uncommon to get daily returns of 1 percent.
5. DEFI PROJECTS
Decentralised finance (DeFi) is advancing rapidly. New projects are launched daily, offering great investment opportunities.
How does it work?
Research must be done thoroughly before investing in DeFi initiatives. It takes a lot of time to properly assess risks and identify initiatives that are intriguing. However, given that many DeFi projects pay off handsomely, it is a worthwhile use of your time.
Start your search with Whatthefork and Defigator, for instance.
Who should invest in DeFi projects?
The strategy is intended for experienced cryptocurrency users, like genesis pools, which is a component of DeFi projects.
In order to generate profitable returns, one needs to have a thorough understanding of the crypto market and technology.
What is the earning opportunity?
It usually depends on the project. For example, Toxic Deer has gained fame among DeFi projects.
The protocol aims to stabilise purchasing power without any rebasing or collateral risk by increasing and decreasing supply in a manner similar to how central banks exchange fiscal debt.
The project’s foundation is the DEER token (pegged 1:1 to USDC).
So how can you generate income from it?
XDSHARES are purchased, then deposited on the platform. Your XDSHARES will print DEER tokens with an average daily APR of 4 percent as long as the DEER price is greater than the USDC price.
6. CRYPTO MINING
This is the riskiest approach. However, it has immense earning potential. It is worthwhile to note that crypto mining has a high potential for scams if the wrong platform is chosen.
How does it function?
Firstly, the mining of cryptocurrencies in this context has nothing to do with the standard Bitcoin mining procedure. On the other hand, you may contrast cryptocurrency mining with staking or lending. However, the two are slightly dissimilar.
Typically, the initial step involves depositing a certain sum of money. There is no way for you to withdraw this locked deposit.
However, starting from the time of the deposit, you will receive a consistent return for an indefinite or specified period. However, most cryptocurrency mining projects urge you to re-stake (compound) your winnings in order to increase the project’s value and earnings.
Who will it work for?
This is for those who can take risks and will not mind losing their money if their bet goes wrong.
How much money can you make mining crypto?
Many crypto miners offer daily yields of 3 percent. Some ventures offer 8 percent or more each day. However, the likelihood of a scam increases as daily returns increase.
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