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5 Ways to Earn Passive Income with Cryptocurrencies

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Earn Passive Income with Cryptocurrencies

Generating passive income is an excellent way to supplement your monthly earnings. Fortunately, for digital currency users, there are several ways through which you can generate passive income with cryptocurrencies.

In this article, you will discover five ways to earn passive income in the blockchain economy that you may not be aware of.

Bitcoin Savings Accounts

Rather than purely “hodling” your bitcoins in your wallet, you could transfer them to a savings account, such as Bsave, to receive interest on your coins.

BSAVEBsave is a savings platform that is suitable for both long-term and short-term savers. An account with Bsave provides you with daily interest payments and the ability to withdraw funds at any time. The interest payments depend on the amount you deposited in your account and the length of your deposit. The way that Bsave is able to pay its users interest on their bitcoin holdings is by engaging in margin lending on the Bitfinex trading platform on behalf of its users.

Getting started with Bsave is as easy as signing up and transferring bitcoins to your Bsave account. Once you have completed these steps, you will start receiving your interest payments immediately. Magnr is another popular bitcoin savings platform you can look into if you are interested in earning interest on your coins.

The risk with bitcoin savings account lies in the fact that you are depositing your coins with a third party. Should the company providing the savings account falter, your funds would likely be lost. Hence, earning interest on your coins is not without risk.

Peer-to-Peer Loans with Bitbond

Bitbond is a bitcoin peer-to-peer lending platform that allows investors to invest in small business loans that generate an average annual return of 13 percent according to the company’s website.

BitbondTo earn passive income using Bitbond, you simply sign up to the platform, deposit bitcoin in your designated wallet and then browse through the available loans to find suitable investments. The listed loans have different risk classifications and you are able to look at details of each loan proposal to aid in your investment decision.

To reduce the risk of investing in peer-to-peer loans, it is wise to invest in several loans to build a diversified portfolio. Once, you have built your portfolio, you can start receiving passive income in the form of high-interest payments.

Having said that, there is the risk that some loans may default, which is why diversification is key when opting for this form of passive income.

Here, you can find a full guide on how to invest in peer-to-peer loans at Bitbond.

Staking PIVX

Staking PIVXProof-of-Stake (PoS) cryptocurrencies provide an excellent means of generating passive income in the cryptocurrency space. Proof-of-Stake coins allow users to receive new coins for “staking” their coins in the digital currency’s official wallet to secure the network. Proof-of-stake is a consensus mechanism that, unlike Proof-of-Work, does not require high computing power.

Private Instant Verified Transactions (PIVX) is a privacy-centric community-focused cryptocurrency project that has gained in popularity in 2017. PIVX allows you to carry out private, fast, and secure transactions and gives its users the opportunity to earn passive income through staking their PIVX coins.

Here, you can find a guide on how to stake PIVX.

Earn GAS by holding NEO

NEO

NEO is a blockchain platform that allows for the creation of smart contracts. Often referred to as the “Chinese Ethreum”, NEO has managed to establish itself as one of the most promising blockchain projects in the market today.

Fortunately for NEO investors, it also provides the opportunity to earn passive income as NEO holders receive “free” Gas tokens for helping to run the network. To receive Gas, NEO holders need to have their cryptocurrency in an official NEO wallet. Some exchanges, such as Binance, also credit Gas to NEO holders.

You can find out how much gas you will earn for your NEO holdings here.

Cryptocurrency Cloud Mining

Genesis MiningFinally, probably the most popular way to earn passive income with cryptocurrencies is through so-called cloud mining. Cloud mining refers to the process of mining cryptocurrencies with the use of a remote data centre that shares its processing power with customers who purchase cryptocurrency cloud mining contracts.

Therefore, cloud mining enables individuals to a steady passive income in cryptocurrency without the hassle of having to buy and maintain mining hardware. The most established cryptocurrency could mining services provider is Germany-based Genesis Mining.

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BitMinutes to Reduce Cost of Money Transfer With Blockchain in Nigeria

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BitMinutes

US-based blockchain company, BitMinutes Inc., has launched a blockchain token and an agent network in Nigeria to lower the cost of transferring money and to ease access to micro-loans.

BitMinutes Enters the Nigerian Market

In January, BitMinutes announced a partnership with BODC Trading & Investment Company in a bid to enter the Nigerian market.

BitMinutes would be offering people in the country the ability to purchase goods and services with BMTs, send them to friends and family, and convert unused mobile phone minutes into BMT which could then be turned into Naira for deposit into a bank account. Moreover, in the future, Nigerians will also receive access to micro-loans backed by BitMinutes tokens.

After just two months in the country, the CEO of BitMinutes, Tom Meredith, says adoption has been on the up, according to a report by Business Post.

“We’re ecstatic that Nigeria’s citizens have embraced the BitMinutes Nigeria program. They recognise that the economic incentives, including five percent cash back on purchases of BitMinutes and 12 percent annualised return on those BitMinutes that remain in their account, are very compelling propositions,” Mr Meredith said.

Nigeria will serve as a trial point for BitMinutes before the company expands the business model across other countries on the continent.

The BitMinutes Token

BitMinutes LogoBitMinutes token (BMT) is a prepaid airtime minute on the blockchain. The prepaid minute is a real asset that can be traded and, according to the company, is already traded informally by mobile phone owners around the world.

This token is a cryptocurrency that facilitates free peer-to-peer cash transactions to users’ bank accounts and provides the ability to extend micro-credit and nano-credit to individuals and businesses that have limited access to capital and the traditional financial system.

The blockchain enables the tracking of token ownership and transactional records to build a credit score of users. And the inter-changeability between prepaid minutes and cash makes it possible to collateralise peer-to-peer loans.

BitMinutes’ Business Model

BitMinutesBitMinutes deploys a Trusted Agent Network (TAN) model to provide a physical presence for the network. The BitMinutes Nigeria team will drive the effort to identify and manage TAN Agents, which would be mostly small businesses.

These agents sell BMTs that can be converted to phone minutes on different local carriers and also help users to convert unused cell phone minutes into BMTs, which could be used for payments of goods and services at TAN retailers. TAN agents would also facilitate the process of giving microloans to users. The TAN program already has over 100 agents.

“We have been very pleased with the interest of Nigerians, both in becoming trusted agents and BitMinutes account holders,”

said Ravi Narain, the Director of the BitMinutes Nigeria program.

With only 40 per cent of Nigerian adults having a bank account, blockchain use cases like BitMinutes could play a pivotal role in the financial inclusion programs of the Nigerian government.

Nigerians are already one of the top adopters of bitcoin on the continent, using the cryptocurrency primarily for investment and remittance purposes. According to a recent Luno survey, which sampled over 1,000 Nigerians, 70 percent buy cryptocurrency as a form of investment while only 30 percent use digital currencies for payment and remittance.

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Nairobi Securities Exchange May List Africa’s First Cryptocurrency ETF

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Africa's First Cryptocurrency ETF

Kenya-based Badoer Group ADK ETF is gearing up to launch a crypto-based exchange traded fund (ETF) on the Nairobi Securities Exchange in the first quarter of 2019. If their application is successful, it would become Africa’s first cryptocurrency-backed ETF.

Africa’s First Cryptocurrency ETF

Badoer GroupBadoer Group ADK ETF, a private company incorporated in October, is reportedly finalising an ETF listing arrangement on the Nairobi Securities Exchange (NSE), according to a report by Business Today.

If approved, the NSE would regulate Badoer Group ADK ETF, giving ordinary investors regulatory protection to invest in the asset. About 50 percent of the total ADK in supply, which is 12.5 million ADK, would be available for the ETF.

The founder of ADK, Ricardo Badoer, has reportedly met with the NSE’s commercial director, Ms. Bahati Morara, and the head of Innovation and Project Management, Mr. Irungu Wagema to finalise the ETF listing arrangement.

The NSE is one of the leading securities exchange in East Africa with 66 listed companies and over $20 billion (KES 2.10 trillion) in market capitalisation.

Road to the First ETF

In 2018, there have been debates about whether or when a Bitcoin ETF will get launched. Many believe it will allow investors to diversify their investments without actually owning the assets tracked by an ETF. While others think it is just a distraction to the development of the technology.

Last month, the U.S. Securities and Exchange Commission (SEC) had stopped accepting public feedback on their Bitcoin ETFs policy review. The market regulator postponed decisions or denied applications to list various ETFs. The SEC cited issues like the volatility of bitcoin and rumoured manipulation of prices as obstacles.

However, in Sweden, XBT Providers already provide bitcoin and ether as exchange-traded products (ETP) on Nasdaq Stockholm, a major Swedish exchange. ETFs are one of the investment vehicles under ETPs.

Having crypto-based fund will make sense to many investors who were cautious of putting their money in an unregulated cryptocurrency market. ADK’s anticipated move with an African-based ETF could open the market to a lot more African investors and institutions.

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Egypt’s Central Bank is Considering Issuing a Digital Currency

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Egypt central bank digital currency

Egypt has reportedly joined the list of countries that have started studying the issuance of digital currency as an option or alternative for their fiat currencies. That makes Egypt one of the few sovereign countries in Africa to consider a national digital currency option, which is somewhat surprising given the country’s negative stance towards cryptocurrencies.

The “Egypt Coin”

egypt bitcoin exchangeThe Cairo-based news outlet, Amwal Al Ghad, reported that the sub-governor of the Central Bank of Egypt (CBE), Ayman Hussein, confirmed the prospect of government-issued virtual currency in a conference in Abu Dhabi. He said the bank is conducting a study in collaboration with some international financial institutions.

However, he did not disclose details about the proposed currency and did not address whether it would be traded between banks only or issued to the general public.

Amwal Al Ghad says the bank believes the digital currency could “lower the cost of banknote issuance and use of cash.”

State-Issued Digital Currencies

Many central banks all over the world have considered issuing their own digital fiat money, rather than support cryptocurrencies like bitcoin.

In July 2016, the Bank of England became one of the first institutions to analyse the possibility of state-issued virtual currency. Followed by central banks in Canada, Russia, China and Sweden among others, as well as the European Central Bank.

However, Tunisia was the first country in the world to put their national currency on a blockchain in a trial in 2015. The eDinar initiative did not receive enough backing to go beyond proof of concept but highlighted the interest of central banks in testing a blockchain-based currency system.

The following year, various news media wrongly reported that the Senegalese government issued a digital currency on the blockchain. It had issued an e-currency, the eCFA, but it was not created on a blockchain.

Making State-Issued Digital Currencies Work

The use of this progressive financial technology is a positive step forward to help unbanked people in Africa. Also, it could aid electronic payments and support a cashless society.

Still, some people have questioned the approach of these countries. Centralised blockchains with power concentrated with the central banks could impose limitations on general adoption. The allure of the blockchain technology in the first place is decentralisation, giving people freedom from the traditional centralised banking system.

The impact of a central bank issuing its own cryptocurrency is potentially disruptive, even on the business model of commercial banks. The most practical approach for most central banks, it seems, is to restrict the use of cryptocurrency within an inter-bank context.

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