9 PROVEN Ways to EARN Passive Income using Crypto [2022]

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You can always have a stable passive income flow and earn extra money from your existing cryptocurrency.

In this article, I will show you what you can do with cryptocurrency instead of storing it in software/hardware wallets.

How to generate and earn passive income from cryptocurrency?

Here are the nine (9) PROVEN ways that you can use to generate passive income from your existing cryptocurrency.


1. Dividend-Paying Cryptos

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Crypto dividends behave similarly to traditional stock dividends. Both receive part-profits (dividends) from the company, or in this case, from the coin/token itself.

Some cryptocurrencies reward their holders by giving them rewards. All you do to do is store them in a wallet, and you will be entitled to a small portion of crypto rewards, usually annually.

KuCoin Shares (KCS)

KuCoin Shares (KCS) are the native currency of the KuCoin exchange platform that allows holders to profit from the exchange’s success. KuCoin considers the amount of KCS users holds when distributing the various coins. The more KCS you own, the more dividends you’ll receive.

Kucoin token (KCS), By holding these KuCoin shares, you receive a daily bonus/dividend called KuCoin Bonus. The bonus you receive is 50% of the trading fees.

Buy directly from KuCoin exchange using various payment methods, including credit card (VISA & Mastercard), SEPA, Apple Pay and wire bank transfer.

Komodo (KMD)

Launched in 2016, the Komodo platform is designed to be secure and progressive. It is privacy-centred, allowing users of KMD currency to make private transactions with zero-knowledge proofs.

Holders of KMD can receive up to 5% interest per year on their KMD tokens. You do not need to keep your wallet open or stay online for the interest to be proved; however, you must have stored at least ten (10) KMD tokens in your wallet to be eligible.

You can directly purchase Komodo (KMD) tokens on the Huobi Global exchange, using various payment methods such as Wire Transfer, Apple Pay, Cash App, WeChat, PayNow, Google Pay and many more.


2. Crypto Credit/Debit Cards

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Sometimes, the best passive income comes together with our essential lifestyle spending. The method involves spending on your essential needs, e.g. groceries, online shopping, and even travelling like airfares and hotels.

Crypto.com VISA Card

The Crypto.com Visa Card is a prepaid card. Therefore it behaves like a debit card. The only difference is that it requires topping up instead of linking to your bank account. Using your Fiat Wallet, Crypto Wallet, or credit/debit card, you can top up your card. All card rewards are paid in CRO tokens and deposited into your crypto wallet on the platform.

The VISA card comes in five (5) different variants and colours. The card benefits include reimbursement of merchants, e.g. Netflix, Spotify, Amazon Prime, Expedia, Airbnb and Airport Lounge access.

Gemini Mastercard Card

The Gemini Mastercard credit card has rewards available in bitcoin, ether, or 60+ other cryptocurrencies. In addition, the company offers users 24/7 customer support and a choice of a black, silver, or rose gold stainless-steel card, made from 75% recycled material.

You will receive real-time alerts based on transaction size or type for security reasons. Some of the card benefits are below;

  • Up to 3% back on dining
  • 2% back on groceries
  • 1% back on all other purchases
  • No annual fee
  • No foreign transaction fees
  • No exchange fees to acquire your rewards

3. Crypto Savings Account

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Instead of storing your crypto in a software or hardware wallet, you can also keep your spare crypto in cryptocurrency savings accounts to earn you some interest in return.

How does it work?

You deposit crypto in your savings account, like the traditional bank savings account. Then, the platform lends your crypto to borrowers for a specified period and agrees on interest. In return, you get paid a portion of that loaned interest.

Some of the popular crypto savings accounts include;


4. Crypto Lending

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You can lend out your existing cryptocurrencies to platforms and exchanges, in return for passive income in the form of crypto interests.

The interest paid to lenders comes from the fees borrowers pay in exchange for access to liquidity when trading on services e.g. margin.

You can lend out your crypto;


5. Yield Farming

Similar to pure lending, this method applies to both the borrowers and lenders and occurs mainly in a decentralized application (dApp) instead.

You use decentralized exchanges (DEXs) to lend, borrow or stake coins to earn interest and speculate on price swings. When you deposit your crypto assets to a DEX, you provide trading liquidity and earn rewards in return. Besides DEXs, other forms of dApps such as crypto wallets and decentralized social media can also work.

Some of the popular yield farming protocols are;

  • Curve Finance
  • UniSwap
  • PancakeSwap
  • Compound

6. Crypto Staking

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Two (2) ways here. Firstly you can stake your cryptocurrencies that operate on the Proof-of-Stake (PoS) consensus algorithm, or secondly, you can stake your stablecoins.

Stablecoins

Stablecoins are often pegged to the fiat currency, most commonly the US dollar. For example, one (1) Tether is equivalent to one (1) US dollar.

Staking stablecoins are more lucrative than staking coins/tokens. This is because the APY interest rates are often much higher.

The table below lists some of the highest APY rates offered by platforms & exchanges.

Platform / ExchangeUSD Coin (USDC)Tether (USDT)
MyConstant14.0% APY14.0% APY
Vauld12.68% APY12.68% APY
BlockFi7.25% APYNot supported
Rates are last checked & accurate at the time of this post

Go for Tether (USDT) or USD Coin (USDC). These are the two (2) mainly used and accepted stablecoins in the crypto industry.

Coins/Tokens

These cryptocurrencies, coins, and tokens operate on the Proof-of-Stake (PoS) consensus algorithm. Popular coins are Ethereum (ETH), Solana (SOL), Cardano (ADA), Algorand (ALGO) and many others.

Because they are designed to be staked in a manner to secure and verify transactions on their blockchain, they are intended to receive staking rewards.

In recent times, many staking platforms have also made non-PoS coins/tokens “stakable” in their own ways. In short, as long as the platform supports you can stake your Bitcoin (BTC) and other coins to earn some passive income.

Some of the staking platforms you can use are;

Staking PlatformStaking Interest
AQRU12% staking on USDT and USDC
7% staking on BTC and ETH
Celsius7% – 10% staking interest on stablecoins, e.g. USDC
5-9% staking interest for DOT, MATIC, AVAX and SOL
Supports over 45+ coins/tokens
MyCointainer11.90% staking interest on MATIC
5.20% staking interest on Cardano (ADA)
Supports over 100+ coins/tokens
Lido8.7% staking interest on Polygon
4.7% staking interest on Solana
Support 5 coins/tokens

7. Earning with Crypto Exchanges

Most crypto exchanges offer a <Earn> or similar feature that allows users to deposit their crypto assets with them, usually in either a fixed or flexible term, and let them earn interest on their crypto. In addition, some exchanges have used educational learning to offer some incentives to their users in recent times.

ExchangeEarn
CoinbaseCoinbase Earn: Receive crypto for learning and completing their educational tutorials
GeminiGemini Earn: Lending your crypto assets to specific institutional borrowers and earning interest on your crypto
KuCoinKuCoin Earn: Managed by KuCoin wealth management service platform that uses various financial products to increase holdings

8. Crypto Trading

Buying and selling your crypto assets at the appropriate right time can give you some passive income from time to time. This method may not be as complicated as you may think.

One of the common ways of performing crypto trading is to buy when there is a price drop. The larger the drop, the higher the profits you will earn when it eventually recovers. The risks? You could go down to nothing if the crypto asset keeps dropping.

The safer way is to perform trades on established cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH). It is highly unlikely these established coins can go down to nothing and not be able to recover back in value.

Besides spot trading, exchanges offer a wide range of services, such as margins, futures, options, etc.

Go for the most established cryptocurrency exchanges, such as;


9. Cloud Mining

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Cloud Mining is a remote mining process that allows users to mine cryptocurrency without buying specialised high-end hardware.

You can have a passive stream of crypto returns if done correctly.

Gate.io Cloud Mining

Gate.io exchange offers its users cloud mining services. To do this, users only have to purchase cloud mining contracts and lease hash rates for mining to start earning mining rewards.

Mining outputs are a daily settlement; anyone can mine by purchasing mining contracts.

Some of the benefits are;

  • Low capital as there is no need for buying mining hardware
  • No hardware/rig maintenance
  • No expertise is needed for mining configuration
  • Low entry barrier

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