How much can you earn on cryptocurrency

Earnings on cryptocurrency. The main ways
Trading cryptocurrency on the exchange is a business with its own risks and profits, where every decision either brings income or leads to losses. Earnings on cryptocurrency are determined by several indicators, and in professional trading it depends only on the size of the deposit.

Investors working for the medium or long term use several profitable strategies at once:

• Portfolio investments with the formation of a set of profitable coins;
• hoarding – passive investing: you keep coins in your wallet until they reach your profitability targets;
• stacking – storing cryptocurrency with commissions in a wallet, which is used to support a blockchain network;
• mining – a way to make money on cryptocurrency by mining coins on specialized equipment;
• hodeling, which involves investing in promising tokens in the hope of their explosive growth;
• the use of referral programs.

How to build a cryptocurrency portfolio
To make money on cryptocurrencies, it makes sense to assemble a competent portfolio. First of all, it should be balanced, that is, it should consist of 4-8 cryptocurrencies selected according to a number of parameters.

There are two types of cryptocurrency portfolios that are assembled similar to traditional assets. A conservative portfolio with minimal risk will have reliable and proven currencies, while an aggressive portfolio will have promising and new currencies, which means that they imply a certain risk.

Conservative cryptocurrency portfolio
Let’s consider a conservative portfolio. The main share – 70% – must be reliable coins from the top 5 cryptocurrencies (BTC, ETH, USDT).
Another 25% can be coins from the top 10, behind which there are serious, proven companies in the cryptosphere (XRP, SOL, ADA).
5% can be left for highly volatile coins that have shown rapid growth – for example, in March 2022 it would be ApeCoin (APE), Waves (WAVES), THORChain (RUNE). Even if a steep drop happened, the losses would be balanced by a large share of reliable coins.

Aggressive cryptocurrency portfolio
Now let’s look at an example of an aggressive portfolio. Reliable coins in it – bitcoin, ether, USDT will occupy 50%.
At the same time, promising coins from the top 50 – SOL, ADA, RUNE and others – will account for 25%, and another 25% will be high-risk assets in the range from 50th to 100th position (BAT, OMG and others).
During the growth of the main cryptocurrency, the return on such a portfolio can exceed 100% per annum. This is because bitcoin growth is always followed by altcoin season, a time when the major coins pull up in price.

How to make money on cryptocurrency. Bitcoin example.
Back in March 2020, bitcoin’s value was dipping just below $4,000 amid panic over the spread of the coronavirus. And in March 2022, it’s trading at $47,770. And that’s without taking into account the record in November, when BTC rose on various exchanges to almost $68,000.

If you bought bitcoin two years ago at $4,000 and sold not even at the peak but now, in March 2022, you would have earned $43,000. So the net return on investment was 1,094%.

Bitcoin has not only survived the global economic crisis caused by the coronavirus pandemic, but it has also fully realized its potential as one of the financial world’s top defensive assets. It has also received a tremendous amount of attention from institutional investors, who are now actively investing hundreds of millions of dollars in the cryptocurrency.