BEST Crypto Staking Strategy for HUGE GAINS - Crypto Passive Income

if you're not staking your crypto holdings and earning rewards as a holder it's like putting your life savings in a bank and telling the suits to keep the interest crypto staking can be a very fruitful way to increase your crypto returns and also earn passive income on the cryptos that you don't want to sell hey guys james here and in this video i want to go over the very best ways to earn passive income on your cryptocurrency i'll explain what staking is why so many people do it ways to earn income on your cryptos what coins support staking and the best strategies to get the most income and returns overall including the best services you can use so firstly let's come to staking and what it actually is and there are different ways to earn income on your crypto but staking specifically refers to the process of putting your coins up as collateral in a proof of stake blockchain it's really important to know how proof of stake works why you're putting your coins up for staking and what happens when you do proof of stake is a modern evolution of how blockchains work cryptos like bitcoin are built on proof of work blockchains which means that the computers that keep the network running use powerful computer systems and huge amounts of energy simply to work out the answer to a complex question if a computer works out the answer first they get rewarded with bitcoin this is known as mining the problem here is that the only people who can gain rewards are the miners us investors are left out proof of stake is different more modern and more inclusive the computer power needed for the complex calculations in proof of work are in reality totally pointless the only reason they exist is to keep the network in so called good order with proof of stake this isn't necessary there are many different versions of proof of stake but in essence nodes in the blockchain are given the task of keeping the network in good order instead of doing work they simply put up coins as collateral if they don't keep the network in good order then their coins will be slashed which is a financial penalty if they do their job properly they'll be in the running to receive a portion of the fees spent on the network investors like you and me though can't just start up a node of a blockchain and start earning loads of money mainly because investment minimums are high luckily though we can participate in a staking pool where we can pool our investment with other small investors and give them over to a service provider who can stake them for us giving us our rewards whilst taking a small cut for the service provided crypto staking isn't available on all cryptocurrencies but only those built on proof of stake blockchains coins build on proof of work blockchains like bitcoin can't be staked to earn rewards but if you own bitcoin you can still earn some income on your holdings by using other financing methods so with our passive income strategy we can use three main methods to earn income number one is staking like i've just talked about we can stake a variety of coins built on proof of stake blockchains like cardano and polkadot a quick look on binance earn is all you need to see how much you can make from these staked coins a variety of coins support staking but for me coins that are higher value are the ones i'd be looking to stake coins like cadano ada and polkadot are prime examples when you state coins you don't have access to them during the staking period because they're being used as collateral so it's important to consider what the price of that crypto will do during the staking period i'm happy to hold both my dot and ada positions so i'm happy to stake for 30 60 or even 90 days as i can predict 99 that i wouldn't be selling those anyway something like polka dot is giving an annual yield of 15 right now try getting that in a bank the second way to earn is to lend out your coins market participants and traders often need to borrow coins to settle trades and for various other reasons instead of buying bitcoin it may be cheaper for them to borrow bitcoin and pay a small fee you can use a service that pulls your bitcoin with others and loans it out to traders for a fee and in return you'll get a payment for use of your bitcoin the third way to earn income on your holdings is to place them into a liquidity pool classic examples of this are uniswap and binance liquid swaps with swaps you put up your coins into a pool so that other people can trade them and you'll earn a fee for doing so liquidity pools in my opinion are incredibly difficult to navigate and can potentially cost you money overall rather than just holding your coins i prefer something like binance liquid pools over uniswap right now because of the astronomical gas fees on the ethereum network let's get on to the services that you can use to earn the best income on your cryptocurrencies the first two services that i want to highlight right now are blockfi and also celsius there are two brands that actually do the same thing and depending on where you live you might have to choose one over the other block five at the moment anyway serve north american markets and celsius do serve uk and european markets although i have heard that blockfi will expand their product offering soon to more countries so be sure to be on the lookout for their services in your country but both blockfy and celsius do the same thing they are lending systems where you can lend your cryptocurrencies out and earn an income based on how much you lend with blockfy you can provide liquidity in many different cryptocurrencies including bitcoin ethereum litecoin and us dollar tether as of making this video you can earn an 8.6 return on your holdings on various cryptocurrencies on blockfy you can come down and choose the cryptocurrency that you want to lend out and then put how much you have how long you want to lend it out for and it will tell you how much interest that you will earn over the period if you like many people want to just buy and hold bitcoin and come back in 15 or 20 years time to see how the price has hopefully gone up then you may want to consider lending it out this is going to be much better than just holding the bitcoin in your account and not earning any interest or yield on it whatsoever there's absolutely no way that you're going to get an 8.6 return on cash in a bank and if you're going to hold your bitcoin anyway then 8.6 is a mighty yield to get on that asset there are risks to this of course firstly the price of bitcoin can fluctuate however that would be happening even if you didn't have it in this lending platform another risk is default risk that is the risk that the people you lend to won't be able to pay back the bitcoin blockfy though does have policies in place including insurance to prevent losses do be sure to check the fine print if you do want to sign up for a service like this though celsius is more or less the same thing so you can borrow cash if you have cryptocurrencies and you can also earn rewards based on lending out the cryptos in your account and next i want to come on to something like ave or other other is a decentralized lending protocol services like blockfire and celsius are centralized they're essentially profit-making companies other though is just a decentralized protocol which means that you can interact with borrowers and lenders in a completely decentralized open and free way it's a totally free and open market with no commercial entities in the middle borrowers do pay a fee and lenders will share that fee based on how much they're lending but because other is built on top of ethereum the list of supported coins is a lot lower than some other platforms you can see support here for us dollar tether coin bases stable coin usdc die and a couple of other stable coins as well as gemini dollar and one downside of using aver is that you cannot lend out bitcoin because it is on the ethereum network if you wanted to do that you'd have to go and convert your bitcoin into wrapped bitcoin which is on the ethereum network you can see rates here are not the best compared to some other platforms as other is decentralized it does take a learning curve and you need to know what you're doing and take control of your assets and then plug in your wallet in order to use it the same goes for uni swap as well which is another way to earn some income on your holdings uniswap is a decentralized trading protocol that allows for decentralized swaps of ethereum based tokens once more you can't earn any income on bitcoin holdings because you need erc20 tokens to swap on this platform you can then put over your erc20 tokens into a liquidity pool and then allow others to trade them those traders will pay you a 0.3 fee for the trouble so that is the money that you'll be making if you put your coins over to the liquidity pools in uniswap like i said before liquidity pools are really quite complex and there's no guarantee that you'll actually be making money overall compared to having them in a normal exchange so you have to make sure you do your calculations correct if you want to use one of these also with the current gas fees on the ethereum network right now it makes trading in and out of these pools extremely expensive and probably not a good deal overall which is the main reason why i don't consider using unit swap for my investments but you're different than me so you're welcome to have a look we can also move on to binance which has a really robust system for investments called binance earn there are many different ways to earn income on your products you can use flexible savings which have lower returns but are considered less risky and then you have some higher returns based on staking and also fixed savings also you can use d5 products and binance which have much higher returns which will be similar to the returns that you can get on something like ave which is also a decentralized finance lending and borrowing platform that's essentially what binance are doing here although they say they do use various investment methods to give you these returns at the lowest risk you can also gain an income via the liquidity swap pools on binance which is more or less the same thing as what uniswap does with their liquidity pools and again you can see the average yields here if you were to put some of these pairs of tokens into the liquidity pools next we have crypto.com which has a few different services and like blockfly you can lend out your tokens to earn an interest right now on most cryptocurrencies you'll be earning 6.5 percent as an annualized yield and if you have any stable coins you can earn up to 12 percent you do have to have some cro on account though to increase the amount that you receive cro is crypto.com coin and you can buy that with them on their exchange and hold it in your account crypto.com has excellent coin support with supported coins as you can see here bitcoin ethereum litecoin cosmos chain link and many more and also a good list of stablecoin support as well a downside of crypto.com is that interest is calculated daily and not in a compound way like it's done on blockfy if you want an all-in-one service though crypto.com is for you because there is an exchange there is also an app a payments method and even a credit card that gives you cash back on purchases what's the best strategy for earning passive income on your crypto holdings then well this will of course depend on your investment outcomes and risk profile for high value stakeable coins like ada and polka dot you may want to look into staking them directly on a staking pool staking returns are clearly set out for you before you enter into the staking agreement with the pull provider finance have a fantastic staking product with binance earned that allows you to hold your coins and stake them easily with good returns binance offer a good range of coins for staking and certainly more than coinbase and kraken binance also offers savings and d5 products that offer higher returns for coins like bitcoin and us dollar tether currently d5 returns and binance are seven and a half percent for bitcoin compared to eight point six percent on block fire owning eight point six percent is significant on block fire and those lending platforms usually have a short redemption period if you need to access your coins a decentralized service like ave is more niche with a smaller amount of supported coins but potentially higher returns than centralized lending companies like blockfi for example you can get an 11 return on us dollar tether right now on ave and that compares to 12 and a half percent on finance for defy lending with decentralization though you are on your own when it comes to making your investments and making sure you're doing everything correctly one other thing to note is that risk levels are almost impossible to identify in the crypto space there are no ratings agencies for cryptocurrencies and you really cannot work out what your risk adjusted returns are that you're making but in general staking has the lowest risk as you are just participating in blockchain rewards lending coins is riskier as you introduce default risk and d5 will be the most risky as there isn't a company in the middle with regulations governing them or any insurance either this video is not supposed to be investment advice and i'm not your financial advisor so please take this as a guide to some of the products and services out there that you might want to use do give the video a thumbs up if you found value sub for way more helpful cryptocurrency content and i'll see you in the next one

Channel: MoneyZG

Views: 261,901

Keywords: crypto staking, cryptocurrency staking, crypto staking strategy, best crypto staking strategy, how to stake cryptocurrency, how to stake crypto on binance, how to stake crypto, cryptocurrency passive income

Id: sS3E2xKFVBk

Length: 13min 48sec (828 seconds)

Published: Thu Feb 25 2021