Passive income on cryptocurrency

Today we are going to talk about the possibilities of passive income from cryptocurrency. The methods that we are going to analyze allow you to earn not by increasing or decreasing the value of the asset, but by holding it and getting remuneration for it. Next, we’ll break down three such methods.

Lending

Is the oldest method of passive income. When you use lending, you lend and become a lender. In most cases, the lending option is provided by cryptocurrency exchanges that require liquidity for margin lending to traders. In such cases, you lend to leveraged traders and they pay you a percentage for using the funds. The guarantor in this case is the exchange on which transactions are carried out. Landing is available on many exchanges, such as Binance. Also banding is available in some DeFi projects.

Stacking

Stacking is the process of obtaining passive income from blocked coins. This process is directly related to the Proof-of-Stake concept implemented in some blockchains. By participating in steaking, you freeze your coins and thus engage in “passive mining. The main advantage of stacking is that the coins themselves stay in your account, and you do not bear the additional risks of handing them over to third parties, as you are protected by a smart contract.

Farming

Farming is the youngest method of earning passive income from cryptocurrency. Farming is referred to as the process of making profits from interacting with DeFi protocols. The process of farming itself consists of receiving rewards in native tokens of the protocol for providing loans and/or receiving loans, or for providing liquidity to decentralized exchanges and voting. In pharming, returns are usually not set in advance and are in principle hard to predict, so it can be called a synthesis of staking, lending, and trading.

Which method to choose and how to start earning?

It is possible to say unambiguously that all three methods of passive income are applicable, but each has its own specialization. Landing can be used if you are an ordinary trader and have free funds on the exchange. Stacking is more suitable for long-term investors, the so-called hodlers, who hold coins in large quantities for a long time. Farming, on the other hand, suits more active investors who are ready to transfer their assets from one project to another quite often.

Thus, we have a fairly wide range of methods of passive income. However, investors should not think that they can make money doing nothing at all. Passive investing in crypto requires you to be good at allocating your investments and risks, constantly monitoring the market, and sometimes being proactive. If you have insufficient knowledge in these areas, you can still make money from farming and staking. One of the investment activities of our Octopus Longterm pool is farming. You can earn with us by investing in this pool. This feature will appear in early May 2021, we will notify you about it in our chat room on Telegram —t.me/OctopusCC_Eng.

You can invest in pools of our fund and buy tokens OCC through our Telegram bot — t.me/Octopus_VC_bot.