Crypto royalties refer to a stream of passive income generated from the sale, trade or use of a cryptocurrency. The concept of royalties is not new; it has been used in the music, movie and publishing industries for years to compensate creators for their works. Crypto royalties seek to do the same for crypto investors.
Cryptocurrencies, since their inception, have been popular among investors looking for quick and profitable trades. While this approach can generate short-term profits, it may not be sustainable in the long run. Crypto royalties, on the other hand, provide a more stable source of income.
Here’s how to earn long-term income from crypto investments using crypto royalties:
1. Invest in a royalty-generating cryptocurrency
The first step is to invest in a cryptocurrency that generates royalties. These cryptocurrencies are designed to distribute a portion of transaction fees generated by the network to investors who hold tokens of the platform. This means that for each transaction executed on the network, a percentage of the fee is paid to token holders. Examples of such cryptocurrencies include NEO and KuCoin Shares.
2. Stake your crypto
Another way to earn royalties is by staking your cryptocurrency. Staking refers to the process where you hold your crypto in a wallet to support the network’s operation. By doing so, you process transactions, validate blocks, and receive rewards in return. These rewards are paid in the form of a cryptocurrency, which can be sold or held for later.
3. Invest in crypto lending platforms
Crypto lending platforms allow investors to lend their cryptocurrencies to borrowers in exchange for interest payments. These platforms provide a more reliable and less volatile return than trading. The interest rate is typically higher than what traditional banks offer, with rates ranging between 4% to 10% per annum. Examples of crypto lending platforms include BlockFi and Celsius Network.
4. Invest in crypto dividend-paying companies
Crypto dividend-paying companies distribute earnings to their shareholders in the form of cryptocurrencies. These companies generate earnings by providing crypto-related services, such as exchanges, wallets, and mining. Examples of such companies include Coinbase and Binance.
5. Build a crypto portfolio that generates royalties
Another way to earn crypto royalties is by building a diversified portfolio of cryptocurrencies that generate royalties. This approach involves investing in a mix of royalty-paying cryptocurrencies, staking cryptocurrencies, and dividend-paying companies. It’s important to keep the portfolio well diversified to manage risk and ensure steady income.
Crypto royalties provide a way for crypto investors to generate a passive income stream in the long term. By investing in a cryptocurrency that generates royalties, staking your crypto, investing in crypto lending platforms, investing in crypto dividend-paying companies, or building a diversified crypto portfolio, you can earn a reliable and less volatile return than trading. As always, it’s important to conduct thorough research and understand the risks before investing in any crypto asset.
The cryptocurrency space has had a challenging year in 2022 due to various global issues that affected the world economy, including supply chain disruptions, ongoing conflict in Ukraine, and inflation rates. Many NFT projects disappeared, and there was even a crypto collapse when Luna crashed, leading to the destruction of its landing platform, Anchor.
However, investors can still earn money from crypto investments as long-term investors seeking passive income opportunities. One way to do this is through crypto lending and staking, where you can earn decent yields by lending your tokens to borrowers or staking your crypto to verify transactions on the blockchain.
Crypto lending is a popular DeFi service that allows investors to deposit their tokens in a lending platform that loans them out to borrowers looking to secure cash loans using their crypto holdings as collateral. In exchange for loaning your crypto out, you earn interest as you get paid back. Crypto staking involves giving your tokens to a blockchain to verify transactions and earn rewards in the form of a portion of that token.
Investors can also earn passive income from NFT royalties, which allows them to earn a percentage of their sale price every time someone purchases their NFT project on a marketplace. These programs use smart contracts executed on the blockchain, and payments are made automatically.
While these opportunities for generating passive income in cryptocurrency exist, it’s essential to remember that investing in cryptocurrency carries significant risks due to the market’s volatility. Investors must purchase the cryptocurrency coin before staking or lending it and hope that the coin’s price remains strong when it’s out of their hands. Additionally, these investments aren’t secured by federal insurance, and platforms can become insolvent, leading to significant financial losses.
In conclusion, investing in cryptocurrency for passive income opportunities requires careful consideration of the risks involved. Investors must have a long-term outlook and lower risk tolerance, and if they prefer a more established and secure investment option, they should invest in other established markets.