Take up mining or invest in stacking? Conquer the NFT market, trade on an exchange, or finance an upstream project? These are all ways to make money from cryptocurrency in 2022. We’ve prepared a guide for those who are getting into this market from scratch.
New oil, virtual Eldorado, money of the future that is already very expensive – such metaphors and comparisons describe cryptocurrencies.
Over the past couple of years, the number of people who made their first fortune on digital coins from virtually nothing has been multiplying. No wonder that newcomers are also thinking how to get rich off of it. But they don’t know where to start. With mining, investing, trading, creating and selling NFTs, there are a dozen variants.
Let’s talk about ways to make money from cryptocurrency in 2022.
Cryptocurrency is digital money, which is based on a program code, calculated by a computer. Virtual payment systems with their own currencies, which are also called coins. All transactions in this system are protected by a cipher – a cryptographic method.
The cipher is based on blockchain, a colossal database of identifiers and checksums. A new approach, the essence of which is decentralization and general control. Blockchain can be explained more simply with an example.
Let’s imagine a fantastic picture. If country did not have the Ministry of Finance, the Central Bank and other bodies controlling the national currency and finances. This is decentralization. The whole country would agree to keep a common diary of expenditures. Citizen A transferred 5,000 rubles to citizen B. The latter transferred 2,500 rubles to citizen C. No one has access to this money except the sender and the recipient. The transfers are also anonymous. But everyone can watch the money flows.
Such a database is divided into blocks. In the diary example, this could be a page. And each page is linked to the previous one. This forms a chain (chain), which is how it is translated from English. The blocks have their own numbers (identifiers) and a checksum which prevents others from seeing the changes. If we return to the example with transfers, let us imagine that citizen A made a transfer of 5000 rubles and then decided to correct it by 4000 rubles. This will notice the recipient of citizen B and everyone else.
What is the purpose of this? The most popular answer – so that money no longer depends on the authority of central banks, financial institutions. Just the math, which guarantees security.
Most cryptocurrencies are not backed by the rates of real currencies, gold reserves, and get their value only by the trust of their holders, who, in turn, trust the blockchain system.
Popular ways to make money on cryptocurrency