Hello there and welcome to HotNaija, your one-stop destination for latest entertainment news, celebrity gossips and stories, lifestyle content and cryptocurrency news. Today we're going to be sharing a list of other ways you can make more money online with your crypto investment, asides the simple process of buying crypto at a specific price, hodling it for a while and eventually selling it at an higher rate. These are less popular, less used, yet highly profitable earning strategies. So without any further ado, let’s look at some facts of crypto trading in Nigeria, before actually going into the list of other ways Nigerians make millions from crypto.
As a result of the increasing high rate of unemployment in the Nigeria today, many Nigerian youths have turned to the cryptocurrency industry in search of ‘greener pastures’ and an opportunity to earn from the massive growth the crypto industry has witnessed in 2021.
For instance, the cryptocurrency market capitalization has grown by approximately 228% from about $760 billion to currently stand at $2.51 trillion as of the time of this writing. The cryptocurrency market capitalization traded as high as $2.96 trillion earlier in this month of November, 2021.
Asides from the capitalization growth of the industry, there have been instances of astronomical growth in terms of interest in the space, participation in the space and also investments. Speaking on the global adoption rate of cryptocurrencies, “Chainalysis Research” reported: “At the end of Q2 2021, that total score stands at 24, suggesting that global adoption has grown by over 2300% since Q3 2019 and over 881% in the last year.”
The report further lists the growing adoption of cryptocurrencies by emerging economies as a major contributor to this growth. “In emerging markets, many turn to cryptocurrency to preserve their savings in the face of currency devaluation, send and receive remittances, and carry out business transactions,” they added.
Asides from this, the world has over 300 million crypto users worldwide and Nigeria which is among the top countries of the world has approximately 13 million users. Using an assumed population size of 200 million people, this means approximately 6.5% of Nigerians have used cryptocurrencies in one shape or form.
With these facts, we will now look at ways in which Nigerians have been able to mint profits by leveraging this new industry.
(1). Staking
If you’ve been following news in the crypto space, you might have heard about staking. Whether in relation to Ethereum’s upgrade (Ethereum 2.0) or across smaller coins that make staking a big part of their set up – eg. Cardano, Polkadot and Solana, its fast becoming a more mainstream aspect of crypto trading.
Staking is a way of putting your crypto to work and earn rewards in return. Staking cryptocurrencies is a process that involves committing your crypto assets to support a blockchain network and confirm transactions. It's available with cryptocurrencies that use the proof-of-stake model to process payments.
When individuals stake their coins, they are essentially lending their coins to the network to validate transactions. In exchange for lending your coins and helping validate, the network rewards you with additional coins – effectively allowing you to earn interest.
The more you stake, the higher the chances you’ll be doing the task (processing transactions, validating information and more). When you complete the task, as with mining, you’re rewarded. But you can also earn interest for staking generally on some blockchains.
Decentralized Exchanges (DEX) like PancakeSwap, Uniswap and so on, all offer their platform users an opportunity to earn passive income on their cryptocurrency holdings through staking. Many Nigerians have been warming up to this new way of earning passive income from the cryptocurrency market.
(2). Yield Farming
The hot new term in crypto is "yield farming," a shorthand for clever strategies where putting crypto temporarily at the disposal of some startup's application earns its owner more cryptocurrency.
Yield farming basically involves lending or staking cryptocurrency in exchange for interest and other rewards. Yield farmers measure their returns in terms of Annual Percentage Yields (APY). While potentially profitable, yield farming is also incredibly risky.
Yield farming is the popular strategy DeFi users take advantage of to put their cryptocurrencies to work to earn high interest. Nigerians involved in Yield farming also see it as a way to earn passive income on their long term cryptocurrency holdings, as the process involves incentivizing liquidity providers (LP) to stake or lock up their crypto assets in a smart contract-based liquidity pool, in which they get in return, a percentage of transaction fees, interest from lenders or a governance token.
Note: The main difference between yield farming and Staking is that, Yield farming – requires users to deposit their crypto funds on DeFi platforms. Staking is when crypto investors use their funds to support the blockchain and help validate transactions and blocks on the network.
(3). Futures & Options
Future and Options are now among the most common financial products on any cryptocurrency exchange or trading platform, thanks to increased interest among the crypto trading community.
It's no longer news that Bitcoin and digital assets are volatile investments. Many traders attempt to manage their risk simply by buying an asset when the price drops or selling it when the price goes up. The downside of this tactic is that oftentimes money is left on the table after you leave the market. If the price continues to rise after you sell, for example, you’re missing out on profits you could’ve earned had you left your position open.
Cryptocurrency futures allow you to maximize your returns by utilizing the power of leverage to multiply your profits and apply advanced trading strategies. Use futures to speculate on the direction of the market and minimize risk, all while holding less crypto than on a spot exchange.
Another key benefit of futures trading is that you can hedge existing spot positions without additional crypto - allowing you to be agile and prepared for any market environment.
Fun fact: Nigerians’ involvement in the futures and options trading market started long before the advent of cryptocurrencies. Before cryptos became mainstream, Nigerians participated in the commodities and currencies market through futures and options and it was popularly termed ‘forex trading.’
Although Futures and Options share some commonalities, they are also markedly different in certain key respects. They both also derive their value from an asset known as the ‘underlying’ such as shares, commodities, exchange-traded funds (ETFs), share market indices, and in this case, cryptocurrencies, they both however differ in terms of commitment and obligation. Futures represent a commitment to trade that must be squared off at the specified date. Whereas options give the buyer the right, but not the obligation, to exercise the contract.
(4). ICOs/IDOs
Initial Coin Offerings (ICOs) have become a popular way of fundraising for companies. While they can be highly profitable for both companies and investors, there is a large amount of risk involved due to their unregulated nature.
ICOs are another form of cryptocurrency that businesses use in order to raise capital. Through ICO trading platforms, investors receive unique cryptocurrency “tokens” in exchange for their monetary investment in the business.
Top 4 Best ICO's To invest in 2021
• ICO Name – Crypto Stake Token Active
• Sale Start – September 20, 2021
• Rating – 9.8
• ICO Name – Financio Active
• Sale Start – September 15, 2021
• Rating – 9.5
• ICO Name – Kohinoor Diamond Active
• Sale Start – October 20, 2021
• Rating – 9.4
• ICO Name – Digilite Coin Active
• Sale Start – November 4, 2021
• Rating – 7.5
Due to the ease of entry and exit into the cryptocurrency market, any size of investors can participate in ICOs and IDOs unlike with IPOs, where a substantial amount of money is required before participating. Nigerians are now participating in ICOs/IDOs, in hopes of a rapid price increase as a result of high demand at the official launch.
(5). Crypto-Related Jobs
Those looking to start careers in cryptocurrency should have some real-world experience with the digital currency, such as investing. Other desirable experience includes backgrounds in software engineering and computer science. Proficiency with certain hard and soft skills is also important to employers.
★ What degree do you need for cryptocurrency?
Most companies offering a position as a cryptocurrency analyst require a bachelor's degree in either business, finance, or a field related to blockchain technology or cryptocurrency.
★ What Cryptocurrency Careers are currently in-demand
• Chief artificial intelligence engineer
• Account executive
• Software engineer
• Marketing manager
• Accountant
• Financial analyst
• Journalist
• Research analyst
• Whitepaper writer
Nigerians are now beginning to benefit from the world of crypto by clinching to cryptocurrency-related jobs. Some companies in use of cryptocurrency personnels in Nigeria, include; Remitano, Patricia, Nestcoin, Bitcoin Nigeria, etc. So far, since the emergence of these companies, many Nigerians have been able to secure an high-paying job to be able to fend for themselves and cater for their family.
EndNote: Perhaps you’ve seen/heard crypto bosses boast of making profits despite the seemingly poor performance of the market, chances are they’re using one or more of these less popular techniques to remain on the profit side. You too can tap into these secret ways to improve your earnings from the crypto space.
Well, there you have it. Make sure you check out our other blog posts for more information about the crypto market and trending entertainment headlines. Thanks for reading!