What is crypto and how to make money from it

We're sure you've heard the term "cryptocurrency" at least once in the past year from a friend, business partner, or even in the news. Cryptocurrencies are the modern-day equivalent of the nineteenth-century American gold rush.

This digital phenomenon has quickly attracted the attention of the most successful and wise investors around the world and has become a multi-billion dollar industry. Today, it is almost impossible to find a successful software company or bank that has not invested in and tried to create its own cryptocurrency (also known as a blockchain project).

Crypto the result of a spin-off

Few people know that cryptocurrencies were originally a by-product of an entirely different invention. The father of Bitcoin, believed to be the father of cryptocurrencies, is Satoshi Nakamoto (staged name).

Nakamoto's original plan was to create a decentralized electronic money system; something that many have tried to do, but without success. Only Nakamoto managed to create a fully decentralized system that could support itself, avoid double costs and function almost like any other bank. In this case, however, it was decentralized. It was a fully autonomous digital currency, that is, a cryptocurrency.

What is cryptocurrency?

Many people wonder what cryptocurrencies are. They are actually quite simple. Cryptocurrency is a virtual currency that works as a medium of exchange, just like money. It uses special sophisticated codes to verify and protect transactions. It also has automatic controls that limit the creation of more cryptocurrencies.

It is the online equivalent of cash. However, instead of being backed by gold, the central bank, or the government, it is backed by complex codes. It may seem simple on paper, but the amount of work and complex code behind it all, as well as investor confidence, is what drives the price of cryptocurrency up and down.

This new type of digital currency has been around for nearly a decade, and no doubt it will stay. Cryptocurrency, according to many, is the money of tomorrow.

Crypto traders

With the advent of the internet, the way we work, play, shop, watch our favorite shows and movies, study, and communicate has changed significantly. More and more people in today's technological age are figuring out new ways to generate income with minimal effort.

Some people now work remotely as writers, video editors, web designers, teachers, consultants, doctors, and many other professions. Their main motivation was to avoid traveling to work every day, to control when and where they work, and to become financially independent.

Some of these people, like crypto-traders, make significant amounts of money with just a few taps on their screens and keyboards. They make money from the cryptocurrency market, which has grown significantly over the past decade.

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This group of people manages to make money at any stage of the crypto market. If the market goes down, they make a profit. If the market rises, they make a profit. They make profits under almost any circumstances! There are many different ways to profit in the cryptocurrency market. Let's look at some of them:

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Buying and holding

This is one of the most common ways to make large amounts of money by trading cryptocurrency. The method is quite simple and very similar to stock trading.

You buy a certain amount of cryptocurrency, any cryptocurrency, at one price and wait for its value to rise. Once you see that you've managed to make a decent profit on that trade, you sell it at the current market price. Put simply, you buy it at one price and sell it at a higher price.

Buy and hold for dividends

The concept behind this strategy is very similar to the one described above, but there is a slight tweak. Not only can you buy a cryptocurrency at some point in time and then sell it later when its price goes up, but some cryptocurrencies also pay you for just holding them.

Imagine buying a certain cryptocurrency for thousands of dollars and getting paid every month for just holding it! Sounds great, doesn't it?