Table of Contents Show
- What is blockchain?
- How does blockchain work?
- Is blockchain safe?
- What are the ways to make money with blockchain?
- FAQS on 8 Ways to Make Money with Blockchain
Many people have leveraged their spare funds and made passive income with blockchain, especially cryptocurrency. Because many people are already taking advantage of this, some are still trying to figure out their way around blockchain.
Blockchain is a brand-new technology with great growth potential. LinkedIn named blockchain the number one skill. If you have zero programming skills, it is best to start with blockchain.
However, there are so many things to do with blockchain. If you are still searching for ways to make money with blockchain, you are at the right place. This article will take you on a blockchain industry tour and provide relevant information for every aspect.
What is blockchain?
According to Investopedia, a blockchain is a distributed database that is shared among the nodes of a computer network. Blockchain stores information electronically in digital form as a database.
Blockchain was invented to provide a solid, secure, trustworthy database system without needing a trusted third party.
It is well known for its significant role in cryptocurrency systems. Blockchain maintains a secure and decentralized record of transactions.
The main difference between a blockchain and a typical database is how they are structured. A blockchain collects information together in groups, which are known as blocks.
These blocks have a certain storage capacity.
Once a block is filled, it’s closed and linked to the previous closed block, forming a chain of blocks; as the name implies, a blockchain. At the same time, a database structures its data into tables.
See also: The Vast Use Cases Of Cryptocurrency
How does blockchain work?
Blockchain consists of three leading technologies: cryptographic keys, peer-to-peer networks, and a secure way to store transactions and records of a database.
Blockchain works through the following processes:
- An authorized user inputs a transaction, which the technology must authenticate.
- A block represents the transaction or data.
- The block is sent to every computer node in the network.
- Authorized nodes verify the transaction and add the block to the existing blockchain.
- The update is then distributed across the network.
In addition, Blockchain works on the principle of rigid data or records of transactions that cannot be tampered with. For this reason, blockchain is also known as Distributed Ledger Technology (DLT).
Is blockchain safe?
The primary aim of blockchain is to provide rigid decentralized security for databases.
Blockchain achieves it in many ways. To start with, blockchain collects information in blocks; these blocks are stored linearly and chronologically. Meaning that a block will be added to the end of the previous block.
This way, it will be very difficult to alter or cause a change to the existing content of the block. Also, each block has its hash, and if any information is altered, then the hash codes will also change.
However, succeeding with such a hack would require the hacker to simultaneously control about 51% or more of the copies of the blockchain. It would also require a huge about of money and resources, as they will need to redo all the blocks singly because of the different stamps and hash codes.
But due to the size of many cryptocurrency networks and their growing fast, the cost to pull off such a hack would probably be impossible. It would not only be costly but likely a failure.
What are the ways to make money with blockchain?
There are several ways to make money on the blockchain. In this article, we will provide 8 different ways to make money with blockchain.
- Get a job/freelancing.
- Build an app
- Automated trading
- Run a node
- Blockchain businesses
- Launch your cryptocurrency
- Investing in cryptocurrency
- Participate in decentralized finance
Get a job or freelancing
The demand for blockchain developers is high. People need blockchain developers to bring their ideas to life. As a blockchain developer, you can begin to earn good money.
Getting a job as a blockchain developer is one of the ways to make money over the long term. As a remote developer, you can expect to earn a six-figure salary. The great deal about becoming a developer is that it gives you a consistent means of earning, and most jobs are remote-friendly.
Also, if you already have a job, you can become a freelancer as a developer. You don’t have to quit your job to become a freelancer. I also recommend it for beginners, you can use this means to find out if you like the job. You can expect to earn up to $1,000 per hour as a freelance developer. You can find such job offers on sites like Upwork.
Build an app
Regular apps are difficult to monetize, but blockchain makes it easier. This is because, for regular apps, users are compelled to subscribe or to pay for some benefits to use the app.
But for blockchain apps, users already spend money while using the app, so they are in a state of mind to release money for their activities. This money is collected through service fees and gas fees.
Building a blockchain app is great because you can build a real-world finance app without permission. People would use the app to transact, trade, and receive cash regularly. This way, you make your money with blockchain from every transaction.
You can make money with blockchain through automated trading. Automated trading is also referred to as algorithmic trading or system trading.
According to Investopedia, automated trading allows traders to establish specific rules for both trade entries and exits that, once programmed, can be automatically executed using a computer. Automated trading systems typically require software linked to a direct access broker.
You can trade in a decentralized trade/ algorithm trade through different ways such as arbitrage trade and smart contracts.
Arbitrage trading is the buying and selling a particular asset in different markets to take advantage of the price difference and make profits. It is not always profitable because the price difference might be insignificant and can be taken through service charges when transferring the asset from one market to the other.
On the other hand, smart contracts are like arbitrage trading. The difference is that you can always ensure that the trade is profitable.
Trading with flash loans uses smart contracts. In this case, the borrower must pay back the loan before the transaction ends, or the smart contract reverses the transaction.
See also: How to Earn Interest on Crypto | 2023
Run a node
Blockchain is a peer-to-peer network of nodes. Node is just a computer that shares the responsibility of keeping the network. Each node has to be operated by someone, and there is where you come in.
You can make money with blockchain by running a node. Cryptocurrency master nodes have become flexible and rewarding. You can earn decent money in this industry if you are skilled in node operations, either running a validator node, staking, testnet, or chainlink.
Many crypto platforms employ and pay professionals to maintain nodes. The process is complex and requires multiple nodes to maintain, and these services are gotten for a fee.
You can begin to make money on blockchain by running blockchain businesses. Such business ideas include:
- Node operator
- Data and analytics
- Security auditing
As an agency, you can build blockchain projects for other people. To bring their ideas into reality. You can also hire skilled individuals to work in your agency and offer services. This would increase efficiency and yield more income.
The knowledge of blockchain is scarce and valuable. Hardly anybody understands it. This is a huge opportunity for real to make money with blockchain. If you can acquire the knowledge of blockchain, you can pass it down to those willing to pay for it. There are lots of ways to do this, which are:
- Consultancy: you can begin to educate and give advice on how to go about blockchain and make money. In return, you get a service fee.
- Create an educational product
- Write a book
- Market these services in several ways, such as posting on social media platforms or opening a YouTube channel. You can also publicize in media houses and give talks.
If you are skilled as a node operator, you can start a blockchain business as a node operator.
To start with, make sure you have the required skills. Then, set your rates and make yourself available to the market. Platforms will outsource for operators, employ and pay for their services.
You can also get jobs as a freelancer on sites like Upwork and Fiverr.
Data and analytics
Blockchain analytics models visually represent data to identify key information about users and transactions. As a data analyst, you warehouse data about the blockchain and provide information for others.
This is a good way to make money with blockchain. Blockchain systems must be secure,, especially if they handle a huge amount of money. This system is proposed to be airtight and needs security auditors.
Security auditors are in high demand, and you can charge a lot of money for your services if you are skilled.
Launch your own cryptocurrency
You can make a lot of money with blockchain by launching your cryptocurrency. On platforms like Ethereum, you can create your cryptocurrency without creating a blockchain using smart contracts.
When you launch, there are a lot of ways to distribute it.
- Through tokens
- Initial coin offering: people buy cryptocurrency at a specific price.
- Initial exchange offering: list your cryptocurrency on the exchange, and people will be able to buy that way
- Yield farming
- Uniswap listing: same as the initial exchange offering, but it’s quite different because it is centralized.
Investing in cryptocurrency
Investing in cryptocurrency is the most common way to make money with blockchain. HODLing, staking, and trading can do this. You can also invest your time without any cash to earn cryptocurrency by playing games, mining, faucets, and airdrops.
HODLing: This is the best option for beginners. HODLing, a play-on term for holding, is buying cryptocurrency and holding on to your token for a very long time. For instance, in 2019, the price of bitcoin was over $10,000, but in 2021, it rose to over $68,000.
Keep in mind that the prices of these tokens also fluctuate. Do well to research any token before purchasing to avoid being on the losing side. Currently, the price of bitcoin has dropped by 40%.
You can earn passion income on idle tokens by staking. Staking involves locking tokens away for a certain time to help validate transactions on proof-to-stake blockchain networks.
Imperatively, you will receive interest at a particular rate for as long as your tokens are locked away.
This is very lucrative, and to do this, you will have the basic knowledge of analyzing the cryptocurrency market. This is to determine whether there will be a rise or fall in the token price.
They are cryptocurrency tokens deposited into your wallet for free. The basic aim is to distribute newly launched project tokens directly into people’s wallets to aid circulation.
Faucets are similar to airdrops, but you earn free cryptocurrency by completing simple tasks like captchas.
Basically, mining is the process of connecting hardware to a desktop device that connects to the cryptocurrency’s blockchain. The idea of mining is to enable the network to operate in a decentralized manner.
You can also earn cryptocurrency by playing games. Signup on crypto platforms to play games like Axie, Alien worlds, SandBox, and many more.
See also: 25 Strange Ways to Make Money Online in 2023
Participate in DEFI
In full, DEFI stands for Decentralized Finance. In this process, traditional finance products are moved to the blockchain. Things like trading, loans, savings, and so on. This is trending and taking off like crazy.
Ways to make money on DEFI
You don’t have to be a developer to participate in DEFI,, but you will have a greater advantage as a developer. As a developer, you can also detect a scam project. Here are the ways to make money on DEFI.
- High-interest savings
- Yield farming: borrowing cryptocurrency and earning a different cryptocurrency as a reward.
- Speculate on the DEFI token.
FAQS on 8 Ways to Make Money with Blockchain
Yes, you can make money with blockchain by investing in cryptocurrency, building an app, participating in DEFI, getting a job as a developer, and so on.
You can do this through the following ways
Choose your area of specialization
Define and set up your brand
Register your blockchain business and get the necessary permit
Open a business account
Form your business into a legal entity
5 best cryptocurrency trading platforms are Coinbase, Binance, Crypto.com, BlockFi, and Bisq, in no order.
Blockchain is a new technology with great potential. Blockchain creates an opportunity to earn massively and passively.
You have seen the different ways to make money with blockchain from the article. Choose the area that will suit you and also intensively research it before going into it.
Dear reader, take advantage of this opportunity and become the next millionaire.
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