Ten More Ways to Earn/Get More Bitcoin
Bitcoin is a revolutionary asset, and it’s one that has made a lot of people rich. Not everyone, of course. Those who bought Bitcoin in early 2017, for example, have made huge returns on their investment—and even more those who bought Bitcoin prior to 2017. While Bitcoin has gone up and down throughout the years, its overall trend is up. This is due to the fact that Bitcoin is hardwired to increase in value. There are only 21 million Bitcoins that will ever be created, while the demand for this limited asset keeps going up. The law of supply and demand determines the value of any commodity. The best comparison, of course, is gold, which has an extremely limited supply. Gold, of course, is a precious metal, which is mined at great cost, and which has a finite supply on Earth. Bitcoin, likewise, is finite and requires a great deal of energy and computing power to mine. Bitcoin mining, however, unlike gold mining, is hardwired to slow down, with halving in the Bitcoin supply occurring every 4 years, until the last Bitcoin is mined more than 100 years from now. In 2017, I wrote a short e-book/information guide on Bitcoin entitled Bitcoin: 10 Ways to Make Money Using Bitcoin, along with two other information guides on investment: Gold: 10 Ways to Make Money Using Gold, and Information Products: 10 Ways to Make Money Using Information Products. These are all available to purchase and download online. There are, however, a lot more than 10 ways to make money through Bitcoin, so let’s have a look at some more ways to make money via Bitcoin.
Use Crypto.Jobs or other Cryptocurrency Hiring Websites
One of the best ways to make Bitcoin is to work for Bitcoin. This has already been mentioned in my information guide, but it is worth repeating here. When you are paid in cryptocurrency, you take out the middle man. Ordinarily, if you want to accumulate Bitcoin or other cryptocurrencies, you have to buy them using fiat currency (e.g. through Coinbase, Kraken, etc.) and are charged exorbitant transaction fees. When you are paid directly in cryptocurrency, you are able to accumulate Bitcoin without having to use your bank account or debit card. This saves time, as well as money. It furthermore protects your earnings by making them anonymous. Just make sure that you are paid into an anonymous wallet, rather than one which is linked to an exchange or other KYC details. This will allow you to accumulate earnings without having them potentially reported to tax authorities or other government authorities. There are many jobs for software/blockchain developers, marketers, writers, etc. Just find something which is suitable for you. Besides Crypto.jobs, there are several other good places to search for cryptocurrency-related jobs, including Reddit, where you can find jobs at 4/Jobs4Bitcoins, Coinality.com, XBTFreelancer.com, and bitWAGE. In addition, you could search the Bitcointalk Forum Services Section for any available openings.
Earn Bitcoin through Lightning Tasks
The Lightning Network (LN), as I explain in my previous Steemit article on 10 Reasons to Buy Bitcoin, is a way to increase the scalability of the Bitcoin network. A lot of people have criticised Bitcoin’s ability to scale up and provide for the huge number of transactions that a world currency would require. Such criticisms, however, miss the entire point of Bitcoin’s existence. Bitcoin was not created, as Nick Szabo explains, to have excellent computational scalability. Rather, it was created to have social scalability, i.e. by providing a trustless payment network and store of value, in the same manner as gold. While transactions on the Bitcoin blockchain may not be able to directly scale up to the speed and volume of VISA, for example, there are solutions which would allow Bitcoin to be used by billions of people on a secondary layer. The best solution so far is the Lightning Network (LN), which uses a network of micropayment channels to scale to billions of transactions per day without relying on a separate trusted network. There are also sidechains, such as the Liquid Network, which enables faster transactions between businesses and individuals through the medium of Liquid Bitcoin (L-BTC), RSK’s upcoming sidechain (to-be-named), and Paul Sztorc’s Drivechain project, but that’s another topic. One new and innovative way of making money using Bitcoin is through ‘Lightning Tasks’, which are specific tasks which anyone can do in exchange for a reward denominated in Satoshis (the divisible parts of a Bitcoin). The Lightning Task website is currently a proof of concept, so the current reward is fixed at 1,000 Satoshis, which is worth about 6 cents (USD). Nevertheless, something is better than nothing, so this is one extra way to earn Bitcoin online.
Trade Bitcoin peer-to-peer
I have already referred to OTC (over-the-counter) trading of Bitcoin in my short information guide, Bitcoin: 10 Ways to Make Money Using Bitcoin. However, it is worth repeating here in terms of small-scale, direct peer-to-peer transfers of Bitcoin. Over the counter trades are highly unregulated and risky. Unless an escrow service is used, the trades rely heavily on trust, so some kind of neutral party is best used, e.g. Localbitcoins. Even then, the buyer and seller must beware, as the legality of trading Bitcoin and the applicability of taxes varies from one region to another, and from one nation to another. There are numerous stories of Bitcoin traders getting arrested. Back in 2017 in the US, the Department of Justice announced that a Bitcoin trader and his son were arrested and sentenced to prison terms for ‘running an unlicensed money transmission business’. This wasn’t a one-off trade that went wrong, however. Rather, ‘Internet151’ had conducted more than 3,000 confirmed trades since 2012 and had used a series of personal and business bank accounts in order to hide their activities. So, if you are operating your trades for profit, taking a commission, for example, make sure that you are registered as a legitimate business with appropriate licenses and other approval according to the rules and regulations of the jurisdiction that you are in. The last thing you want is for your business activities to get your arrested or accused of a crime. Another example in the US was ‘Bitcoin Maven’, who was sentenced to 12 months and a day in prison, as well as a $20,000 fine for laundering Bitcoin as proceeds of narcotics sales. Again, this wasn’t a small-scale operation. The proceeds of her business included $292,264 in cash, 25 gold bars and 40 Bitcoins, all of which were confiscated by the state. To put it simply, crime doesn’t pay. Therefore, either use Localbitcoins just to buy yourself Bitcoin, or, if you want to make an actual business out of it, make sure that you are following appropriate legislation and regulations, and are paying VAT or other relevant taxes on proceeds. And make sure to ‘know your customer’ (KYC) to avoid accusations of money laundering. It is clear, in this case, that ‘Bitcoin Maven’ ignored that responsibility. While most of these busts seem to happen in the United States, they can happen to anyone anywhere, so be careful.
Trade/buy Bitcoin futures contracts
I have addressed this topic in my previous articles, Digitex: A commission-free cryptocurrency futures exchange (my review), and 10 Reasons to Buy Digitex [DGTX], where I give a brief introduction to futures exchanges and futures contracts and describe two of the main Bitcoin futures exchanges, BitMEX and Digitex. As I explained in the first article, “according to Investopedia, a futures contract is an agreement between a buyer and a seller to buy or sell an asset or commodity for a specified price at a specified date. A futures contract is thus an agreement to buy and sell the asset/commodity/security. In many cases, this does not mean that the actual commodity is exchanged. A futures contract may represent 27 metric tons of corn, for example, but the corn does not necessarily exchange hands.” Why invest in futures contracts? The reason is simple. People use futures contracts because “a futures contract can also be used to hedge against potential losses or gains in the value of an asset in order to reduce volatility associated with the price of the asset. In other words, one may be a Bitcoin holder/investor who wishes to hedge against the volatility of the price of Bitcoin. The Bitcoin investor can reduce the risk of their investment by taking an opposite position in the market to what they are trying to hedge, with one effect cancelling out the other. The goal of hedgers is to reduce risk by protecting themselves against any future drops in the price of the asset.” Speculators, likewise, “buy a contract in the hope that the price of the asset will increase in the future.” In other words, you can use a futures contract to either hedge against the risk of Bitcoin dropping in price, or as a means to speculate on future price rises. Either way, it is a useful way of increasing the size of your portfolio through careful and considered investment. It is not without risks, however, as you may make the wrong bet and lose your initial investment. Buyer beware, therefore, and make sure to only invest what you can afford to lose. If you are interested in finding out more about how to get started, then check out the two articles I have referred to above, or click here for more on the Digitex Futures Exchange and get access to their Early Access Waiting List (which will probably close in December 2018).
- Join a Bitcoin Mining Pool
Bitcoin mining isn’t what it used to be. The mining difficulty increases day by day, but so does the technology used to mine Bitcoin, which advances year-on-year, becoming faster and more efficient, and one way to increase the odds of seeing a return is by participating in a mining pool, which allows you to share your miner’s hash power with numerous others, each earning a slice of a Bitcoin when the ship comes in, so to speak. Some of the top Bitcoin mining pools include: AntPool, which is owned by Bitmain Technologies Ltd., headquartered in Beijing China and founded by Jihan Wu and Micree Zhan in 2013, discovering roughly 18% of Bitcoin blocks over a six-month period; BTC.com, which is second to AntPool, generating 16.5% of Bitcoin blocks over the same six-month period; BTC.TOP, which has mined 13% of Bitcoin of six months; ViaBTC, which offers options to mine different cryptocurrencies, including Litecoin, Ether, Ethereum Classic, and Dash; Slushpool, owned by Satoshi Labs, which has mined over 1 million Bitcoins since December 2010 and 9% of total BTC over a six-month period; DiscusFish/F2Pool, which opened in May 2013; BTCC / BTC China, which was the second largest mining pool as of 2012; Eligius, which has operated since 2011; BW Pool, established in 2014, which mines about 2% of all blocks; Bitfury, which is a private pool that mines 11% of all BTC blocks; the Bitminter Mining Pool, started in 2011, which also produces Bitminter client, a cross-platform program with a clear, graphical interface that works with both GPUs and external ASIC devices; and Ckpool, which is explicitly suitable for miners with old hardware, e.g. GUIs. Bear in mind that Ckpool take 1% of what you make, but it are nevertheless better for hobbyists who use PCs, laptops and GUIs to mine Bitcoin. Other pools, such as Slushpool and Bitminter, specifically advise against mining with a CPU/GPU or smart phone. With regards to Bitmain, one should bear in mind that Bitmain manufactures the Antminer S9 and S9i, which are both used for Bitcoin mining, and Jihan Wu is one of the key supporters of Bitcoin Cash (BCH)—a hard fork of Bitcoin which aims to replace and supplant Bitcoin—which it has so far failed to do and will fail to do. Bitcoin.com also has its own mining pool, pool.bitcoin.com, which, again, one should be cautious of, due to its connections with BitcoinCash. BitcoinCash is not Bitcoin, and Bitcoin.com confuses the issue by trying to create equivalence between the two, especially by referring to Bitcoin by the misnomer ‘Bitcoin Core.’
At the moment, the best way to mine Bitcoin is by using an Application-Specific Integrated Circuit (ASIC) device, which can be customized for a particular use, in this case: Bitcoin mining. These can be bought for as cheaply as $489.99 (Antminer S7), or as expensive as $2,729 (Dragonmint 16T). Cheaper ASICs are, of course, less efficient and have a lower hash rate. The Avalon 6 is relatively cheap, at $559.95, with a hash power of 3.50 TH/s, and the Antminer S7 has a hash rate of 4.73 TH/s. More expensive models, such as the Antminer S9, which goes for $3,000, and the Dragonmint 16T have hash rates of 14.0 TH/s and 16.0 TH/s respectively. The greater the hash power, the more Bitcoin you will be able to mine. Besides the device itself, however, you have to make several other considerations. First of all, is Bitcoin mining legal in your region or locality? If not, then that needs to be taken into consideration. Also, don’t mine Bitcoin on someone else’s PC. That’s just illegal—and you’ll probably get in trouble. Several Russian engineers, for example, were arrested for using a supercomputer housed in the Federal Nuclear Center in Sarov to mine for cryptocurrencies, leading to their arrest. Likewise, a Florida Government employee was arrested for mining Bitcoin and Litecoin using Florida’s Department of Citrus (FDOC) computers, being charged with grand theft and official misconduct. Moral of the story: use your own mining equipment and electricity to mine Bitcoin.
Besides hardware costs, of course, there is the question of profitability. After purchasing an ASIC miner, your main costs will be electricity and internet usage. Electricity is, by far, the most expensive element to your mining plan. If the cost of electricity is too high, you will not be able to break even, and would be better off just buying Bitcoin in an exchange. So, look up the electricity usage per hour of your preferred ASIC device, and look at the terawatt hour costs for electricity in your area/provider, so that you can do the math on how profitable it will be. Electricity costs vary widely from one country to another. In Venezuela, it costs about $530 to mine one Bitcoin while, in South Korea, it costs as much as $26,000. Also, to make matters worse, you have to factor in the rise in mining difficulty. One can assume a daily increase in mining difficulty of 0.4527678%, as factored in on the BuyBitcoinWorldwide website. Moreover, roughly every four years, Bitcoin’s mining rewards (block reward) decreases by half. This is called the ‘Bitcoin halving’ event. So far, there have been two halvings, one in 2012, and one in 2016, with each halving occurring after 210,000 blocks have been mined, with both such events happening before significant bull runs, indicating that the Bitcoin halving event always (or usually) results in a huge rise in the price of Bitcoin. BTCC founder, Bobby Lee, argues that the halving event in 2020 will drive the price of Bitcoin beyond $60,000 or 10x where it currently stands, giving Bitcoin a total market-cap of about $1 trillion USD. Accumulating as much Bitcoin as possible before such an event (e.g. in 2020) is probably a sound idea, though that is something you will have to decide for yourself after researching the matter.
- Invest in Bitcoin and Cryptocurrency-Related Investment Funds
To buy more Bitcoin, you need to earn more money. One could, of course, just get a job and put excess income into Bitcoin. Investing a small amount in Bitcoin every month can go a long way and serves as a form of dollar-cost averaging. However, what about combining traditional investment strategies with Bitcoin? One way of doing is through investing in an investment trust, such as the Bitcoin Investment Trust (GBTC), which is currently the only option (as of 2018) for investors to trade Bitcoin on the stock market. An investment trust is a company which owns a fixed amount of an asset—in this case Bitcoin—and investors pool money to buy shares of the trust, owning contracts which represent ownership of a certain amount of the asset via the trust. Thus, one owns Bitcoin without owning Bitcoin, and one must pay a fee to the company which manages the fund, i.e. Grayscale. As of 2018, Grayscale Investments reports that it is onboarding nearly $10 million in new investments every single week, showing the popularity of Bitcoin investment, with the majority of this money coming from institutional investors (as defined under US law).
Another option is to invest in cryptocurrency investment firms or hedge funds, such as, Pantera Capital, which has reported a 10,000% return over the five-year period from its formation, Pivot Trading-2, which is managed by Hong-Kong-based Amber AI Group, which produced a first-quarter return of 30%, Market Neutral Liquidity SP-Institutional, which has had a 2018 return of 5.7%, Galaxy Digital Assets Fund, which is headed by Mike Novogratz and is listed on Toronto’s TSX Venture Exchange, Polychain Capital, which manages $200 million in assets and was founded by Coinbase’s first employee, Olaf Carlson-Wee, Metastable Capital, run by Lucas Ryan, Josh Seims and Naval Ravikant, which manages $45 million in assets, Blockchain Capital, which raised $50 million, tokenizing $10 million as BCAP tokens which were offered to accredited investors in the US, California-based Reality Shares, which has launched a Chinese blockchain ETF, attracting $25 million in investments, Cayman Islands-based Alphabit Fund, which has a fund of $13 but aims to eventually manage $300 million, Auryn Capital, which launched in August with $12.5 million, Block View Capital, which manages a diversified cryptocurrency portfolio of between $10 and $20 million, Brian Kelly Capital Management, which buys and holds 50% of assets, with 20% investment in ICOs and the rest actively managed, BlockTower Capital, which differs from Polychain and MetaStable in that funds are actively traded instead of simply following a buy-and-hold strategy, Crypto Asset Fund, which launched in June 2018 with $10 million and aims to manage $400 million, Coinshares 1 LP, which is based in Jersey, and many others. Other funds, such as Silver 8 Partners, however, are down in 2018, so buyer beware. Quite likely numerous new hedge funds will arise in the coming months and years. In 2018 alone, some 90 crypto hedge funds have already been launched, with 120 expected to form by the end of this financial year. Out of a total of 600 hedge funds expected to launch in 2018, the number which are cryptocurrency-related represents some 20% of the total, showing rising interest in the space. If you have the means to do so, this is one avenue to explore. Earnings from shares in these funds can be reinvested in Bitcoin to allow one to accumulate more and more Bitcoin.
Earn Bitcoin by Doing Odd Jobs
Everyone has a bit of spare time. The question is: how to utilise it? There are several websites where you can complete surveys and other random tasks, such as BitcoinGet. BitforTip allows you to get tipped for helping people with small tasks, such as finding an ornament or an old advertisement from TV. CoinWorker allows you to complete short analytical tasks which can be done within your browser. When your account accumulates 200 points, the points are converted to an amount of Bitcoin and paid directly into a Bitcoin address that is created when you register. As with a lot of these websites, make sure that it is up-to-date and current. As of 9 October 2018, the last update I can see on their Twitter page is from 5 May 2018, apologising for a delay in payments. Bear the unreliability of a lot of these Bitcoin-related faucets and micro-job payment systems in mind when investing your time in them. If you have a website, you can also post advertisements on your website via CoinAd, which will pay you in Bitcoin. Their payment is weekly, direct to a Bitcoin wallet or via PayPal (as requested), and new publishers are only accepted on an invite basis. This is because they want to ensure quality for their advertisers. Finally, you can use BTC Clicks to earn Bitcoin by posting affiliate and referral links. You get paid per click and can also potentially earn an 80% referral/affiliate commission. The website says that you can earn up to “0.00031 mBTC” per click. A Centibit (cBTC) is one hundredth of a Bitcoin (0.01 BTC), a MilliBitcoin (mBTC) refers to 1 thousandth of a Bitcoin (0.001 BTC), a Microbit (µBTC/uBTC) is 1 millionth of a Bitcoin (0.000001 BTC), and a Satoshi is 1 hundred millionths of a Bitcoin (0.00000001 BTC). So 0.00031 mBTC is actually about 31 Satoshis ($0.0020549187 as of 9th October 2018). If you are happy to be paid 2 tenths of a cent for a click, then by all means. If you are a compulsive internet user, this may be one way of capitalising on your free time.
Earn Bitcoin by Reading Books
Everyone enjoys a good novel or a work of classic literature. PaidBooks allows you to enjoy doing so while earning Bitcoin. In order to take part, you have to visit their website and then sign up for Airdrips. This will require you to login to your Facebook account, which would give them access to your e-mail address and public profile. If that’s too much to give away, then you will want to steer clear of this option. As always, when giving away personal information, the user should be cautious. However, if you are comfortable giving away your e-mail address, then you can sign up and start earning small amounts of Bitcoin as you read. Rather like a Bitcoin faucet (see below), the amounts you will earn will not be great. However, if you are a prodigious reader already, this could be considered an added bonus on top of the enjoyment of reading the books themselves. So, if you enjoy reading on your laptop, tablet or phone, then check it out and see if it is something you would like to do.
Play Online/Mobile Games to Earn Bitcoin
As with a Bitcoin faucet (see below), it is possible to earn small amounts of Bitcoin by playing games. A lot of these games and faucets change their options or shut down over time, so there’s no guarantee that any of these are still working. Tremor Games, for example, allows you earn coins for achievements in each game, which can then be converted into BTC. Cash Clamber is an example of social gaming, which allows you to play head to head against your friends while earning Bitcoin as a result. They also pay Bitcoin royalties for new HTML games, ideas, translations and animations. SaruTobi is a game which means ‘Monkey Fly’ in Japanese. The original game allowed you to fling your monkey through the air while collecting bananas (and Bitcoin). This game was taken down and will be replaced with a new version that utilises the Lightning Network (LN). You can check their website for updates. Takara, which means ‘treasure’ in Japanese, is a mobile game app for iOS devices, which allows you plant and hunt for Bitcoin treasures planted across the world. It’s a geocaching game, rather like PokemonGo. App users plant Bitcoin treasures, and users find and collect amounts of Bitcoin, as well as other tokens. No doubt, more such games, perhaps using the Lightning Network, will arise in the future.
Earn Bitcoin using a Bitcoin faucet
A Bitcoin faucet is a reward system which allows you to receive rewards in the form of Satoshis, for visiting the website, completing a captcha task or other task described by the website. The first such faucet was created by Gavin Andresen back in 2010—this particular example no longer exists (as of Jan 30, 2013). Bitcoin faucets operate by making you perform certain tasks, such as filling in a captcha. Usually, there is a certain amount of Satoshis which must accrue before you can withdraw. Rewards are, moreover, dispensed after a certain interval of time, so faucets can be quite time-consuming to use. There are a number of these Bitcoin faucets, including: Cointiply, Bitcoin Aliens, Bonus Bitcoin, Milli, Bitcoinker, Moon Bitcoin, Satoshi City, Satoshi Quiz, Robot Coin, and Wonderland Coin. Bitcoin Zebra ended operations in July 2016. There are some things to bear in mind before participating. First of all, a lot of these faucets make their revenue through advertising. If you are happy being exposed to advertising, then go ahead. Other faucets can be nefarious. For example, there are mining faucets which highjack your computer’s CPU for mining purposes, and there are also scams which never deliver on the Bitcoin you have ‘accrued’. Furthermore, it is essential to remember that faucets take a lot of time. Due to the small rewards (perhaps 100 Satoshis or more), it may not really be worth your time. But if you are desperate to get Bitcoin for free, this is one of the few options that will allow you to do so. In short, only use Bitcoin faucets if you have an abundance of spare time and no other way of earning Bitcoin.
All of the above offer opportunities for investing in or earning Bitcoin, which is a revolutionary new asset class and the sound money of the future. Whatever method you choose, you should always make sure to invest only what you can afford to lose and hedge against risk. Bitcoin is a new asset class, and, therefore, there is a huge amount of volatility. This is not due to the nature of the asset itself, since Bitcoin is fundamentally an immutable ledger which records transactions on the blockchain. Its value is related to Metcalfe’s law, which determines that a network is valuable in and of itself, and its value increases as the size of the network, the number of holders and users, increases. As Bitcoin is extremely limited, and there can only ever be 21 million BTC, demand for Bitcoin will continue to rise, increasing the price over time. Currently, this is usually measured against fiat currencies. In the future, however, where a Bitcoin standard is the norm, the value of Bitcoin will be measured against real-world goods, much in the same way that the U.S. dollar is measured against a basket of goods for the purpose of measuring inflation. Inflation results from an abundance in the money supply, or devaluation of the currency. Bitcoin, which cannot be devalued, can be regarded as sound money. As such, possessing Bitcoin is possessing real money which cannot be artificially inflated. While the U.S. dollar, euro and pound Sterling are all backed by nothing but thin air, and the goodwill of their governments, Bitcoin is backed by code, the network effect and scarcity, and its value is determined by the fundamental economic laws of the market, such as supply and demand. For more on this, you can read my related article on 10 Reasons to Buy Bitcoin (on Steemit), and my short information guide, Bitcoin: 10 Ways to Make Money Using Bitcoin.