How to make money with bitcoin? Top 5 shapes in 2023
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| How to make money with bitcoin |
Bitcoin was a gold mine for the one who discovered it at the beginning of the decade.
Many people have made considerable profits, either because the cryptocurrency was very easy to obtain or because they were able to buy it cheaply.
Think about it:
If you had invested $ 100 in Bitcoin in 2010 when the cryptocurrency was worth only $ 1 and sold at the peak, when it reached $ 20,000 in 2017, you would have made $ 2 million!
But is it still possible to make money with Bitcoin?
Although some techniques are not as profitable as in the past, there are still several opportunities to get a return on cryptocurrencies. In this article, we look at 5 ways to make money with Bitcoin in 2023.
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| How to make money with bitcoin |
Platforms to Invest in Bitcoin
1. Investing for the Long Term - HODL
The example we mentioned above makes anyone's mouth water.
And yes, not everyone dared to invest $ 100 in Bitcoin when the cryptocurrency was worth very little, and hardly anyone recognized it.
But some did. Some became millionaires. Others ... not really.
It is that to invest in this market you also have to be patient. In other words, do what is called HODL (or Hold, which in Portuguese means to insure) - investing for the long term.
Many people invested at the right time and did not get rich.
This is the case with the retail investor who, imagine, agreed to sell at a loss as much as because Bitcoin was worth "only" $ 14 and because he was tired of waiting:
Moral of the story: patience is a virtue!
However, the potential gains in the past were much higher. Notice:
Bitcoin rises from $ 100 to $ 10,000: 9,900% increase
Bitcoin rises from $ 10,000 to $ 20,000: 100% increase
It is very important to be realistic when investing. But that doesn't mean the good opportunities are gone.
2019 is an excellent example:
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Evolution of the value of Bitcoin in the first half of 2019. |
bitcoin price - make money with bitcoin
Evolution of the value of Bitcoin in the first half of 2019.
After starting the year at just over $ 3,000, Bitcoin reached almost $ 14,000 in less than 6 months.
It's an increase of more than 300%, more than most Shares would have given you in a similar period.
So yes, there are still excellent opportunities to make money with Bitcoin. Just don't expect those crazy valuations from the past. If that's what you want, you should look for other, more exotic cryptocurrencies.
1.1 Invest little by little
One of the most used techniques for long-term investing is dollar-cost averaging (Dollar Cost Averaging).
What's that?
It is a way to invest in Bitcoin little by little. Instead of investing all at once, you buy installments over time, and you define them (every week or every month, for example).
The advantages?
You end up buying Bitcoin always at an average price for the period during which you invested;
Less risk, because if you invest everything at once, the price can go down and you are within reach; With this method, your entry price is constantly balanced;
It allows you to dilute your initial investment over time, making it easier to enter.
If you want to know more about this technique, we have an article on the subject that you can see in the link below.
Learn More: Cost Averaging - Buy Little by Little or All at Once?
INVEST IN BITCOIN
2. Bitcoin trading
Another way to invest in cryptocurrencies is through trading.
Unlike HODL, trading focuses on a short/medium-term strategy. The main goal of this strategy is to take advantage of Bitcoin price movements ... and they happen frequently.
Cryptocurrencies are known precisely for their volatility, that is, for the instability of their prices.
Is this bad for those who trade?
Not! Quite the opposite.
The more the price moves, the more opportunities you have to make money with Bitcoin. And the good thing is that when operating it does not only depend on one direction of the market.
Modern online brokers also allow you to make money on downturns in cryptocurrencies (and other assets like stocks, gold, or currencies as well).
That is, you can earn money when:
The price of Bitcoin rises, for that it opens a buy position;
The price of Bitcoin goes down, so you open a sell position.
That way, you are much more likely to make a profit. When the market is falling, you no longer need to sit still or watch your position lose value.
Learn More: Bitcoin (BTC) - How to Invest in Bitcoin in 2023?
2.1 Brokers to trade Bitcoin
Choosing the best broker to trade will depend on how much you are willing to invest to get started.
If you have little experience in the market and want to start small, we recommend IQ Option as it has a minimum deposit of only $ 10.
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| How to make money with bitcoin |
make money with bitcoin - IQ option
IQ Option has a fairly friendly interface.
This platform allows you to invest in Bitcoin and a total of 12 different cryptocurrencies, at the same time that it gives you the possibility of winning in both directions of the market, as we mentioned earlier.
OPEN IQ OPTION
eToro
On the other hand, if you have a larger starter bank, our recommendation is eToro.
In this platform, the minimum deposit is the US $ 200. However, it offers you a total of 16 cryptocurrencies and another tool that can be very useful: Social Trading.
make money with bitcoin - eToro
Social Trading allows you to copy other investors and make money from their success.
This platform is also very easy to use and has a quick sign-up process as well. If you want to test the platform before using it, you can even create a free demo account.
2.2 Tips to consider when trading
If you are new to this journey, don't think that you will become a professional overnight. On the contrary.
You will need time to learn, so it is important not to get discouraged at first.
Consider reading many articles, like the ones we presented to you on Cryptocurrency, but also on other websites, such as HackerNoon or CryptoPanic, that collect news about that market.
If you want to support your decisions with technical knowledge, you should also consider studying technical price analysis. Don't expect to get all the answers through this method, but we think it's a good way to help you decide.
Learn More: Does Technical Analysis Work With Cryptocurrencies?
3. Bitcoin arbitrage
In short, arbitrage is about buying Bitcoin on one exchange and selling on another, benefiting from price differences between exchanges.
So you need:
Buy Bitcoin in a wallet that has a low price;
Sell Bitcoin on the exchange where it has a higher price.
The trick is to optimize profits to the maximum, taking advantage of price differences between exchanges and minimizing the effect of different exchange rates.
It is that to conduct an arbitration, you will need to consider the deposit, negotiation, transaction, and withdrawal fees since you will have to send Bitcoin from one exchange to another to complete the process.
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| How to make money with bitcoin |
make money with bitcoin - arbitrage
Arbitrage flow.
That is why it is not so simple: it takes time and dedication.
It is necessary to study well which are the best exchanges at any given time, considering not only the price of Bitcoin but also the fees.
It is possible to make money with Bitcoin using this technique. However, keep in mind that the trend is for it to be less and less profitable.
This is because the price of Bitcoin between exchanges is becoming more and more similar and is not expected to change soon.
4. Bitcoin mining
Like arbitrage, mining has also allowed many people to make money with Bitcoin. However, he has had better days.
Mining is the process by which new Bitcoins are distributed. Bitcoin receives in this way who helps to maintain the network, giving computational power to solve the equations that make Bitcoin possible.
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| How to make money with bitcoin |
Mining is becoming less and less profitable because you not only need to invest money in specific devices dedicated to the activity but also pay for the electricity for those devices.
mining - make money with bitcoin
Each box you see in the photo is a device like this, which can cost more than $ 400.
Electricity is not cheap either. Calculating its price around the world, the Elite Fixtures portal made a list with the estimated cost of mining a Bitcoin in each country.
South Korea is the most expensive country to mine Bitcoin, with a full coin costing more than $ 26,000.
mining costs
Costs to mine 1 Bitcoin (2018). Source: Elite Fixtures
In Latin America, the price is substantially lower. We have cases like Venezuela, where electricity is subsidized, or Argentina, where there are very cold places where costs associated with the dispersion of heat from the equipment can be reduced.
However, you still need to add the cost of the devices and the space to store them, as you may also need a refrigerated room.
Also, since this data is from 2018, it is only natural that today's prices are even higher due to:
Inflation: dictates price increases that are generally accompanied by the cost of electricity.
Halving: In 2020, Bitcoin suffered its third halving, cutting mining rewards in half. In other words, you have to double the cost to achieve the same result, which jeopardizes the mining profit.
Of course, mining has already been very profitable. However, all the associated costs penalize the activity more and more. If you are just starting, and if you don't have much room to buy equipment, you could also invest in cryptocurrencies.
Learn More: What is Mining? Is it possible to mine cryptocurrencies?
5. Earn Bitcoin Free
Don't expect to get rich that way, but you certainly have the best rate of return on your investment.
Why?
Because, well, your investment is 0, whatever you do is a return. After all, it is free Bitcoin!
However, if you are considering that your time is also a significant investment (that is), then in that case the story already changes. It is that you will need to dedicate a time that, perhaps, could be more profitable, since many of these solutions only pay crumbs.
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| How to make money with bitcoin |
There are several ways to be rewarded in Bitcoin for the tasks you perform on the internet, such as:
Watch videos;
view advertisements;
Respond to questionnaires;
Testing applications.
These ways to earn free Bitcoin, known as faucets, are not exactly new as they are common with fiat money as well.
Earn Crypto.com, for example, is one of the places where you can perform these types of tasks and earn rewards in Bitcoin and other cryptocurrencies in return. But there are others.
One is the well-known cryptocurrency exchange Coinbase. Indeed, it does not allow all users in Latin America to buy cryptocurrencies, but you can still create your wallet there, receive coins sent by others, and even get free cryptocurrencies.
For that you need to start the courses presented on the platform, watching videos with information about some of the cryptocurrencies that you can trade on Coinbase.
OPEN COINBASE
Conclusion
There are several ways to make money with Bitcoin, however, few are profitable.
Arbitrage or mining, which in the past were two very popular ways to make money with Bitcoin, are now unprofitable and tend to be less and less.
Taps to earn free Bitcoin, although they do not require an initial investment, cost time, and give little profitability.
Investing in Bitcoin or other cryptocurrencies is the best way to make money in that market. You will need initial investment and time to learn, but at least you will have more sustainable returns.
Platforms to Invest in Bitcoin
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