Cryptocurrencies are much more than digital cash. Many projects similar to Bitcoin evolved to build a completely new ecosystem to eliminate the middleman – eliminate centrality. The Blockchain technology behind these projects is a revolutionary technology which will change a lot the next coming years. Imagine if you don‘t have to pay anymore the unreasonable high fees for money providers if you could send it just directly to your peer. Imagine if there exists an open ledger, secured by cryptography where identities are “stored” and you can sign documents with your key, eliminating the traditional signature by your hand which can be easily faked. There are so many projects next to Bitcoin which are much more than only digital currencies. We are still at the beginning and investing now could make you huge profits in the next couple of years.

1. Hodling

It simply means that you buy a cryptocurrency and retain it as much as you can if you think that in the long term the price in $ will rise. If you would have bought a Bitcoin back then in 2009 for around 0.2$ and you haven’t sold it till today: 1 Bitcoin is now worth a couple of thousand dollars. Hodling is a meme which stands for holding your cryptos and not selling them.

2. Masternodes

It all began with the cryptocurrency DASH. Many projects forked from Dash (basically just copied the source code) and like that many Masternode coins were created. With Bitcoin, the “miners” validate the transactions and get paid for their “work.” A masternode is a server which also validates the transactions and gets paid for it. You can rent a server for as less as $5 a month from platforms like vultr. As a requirement, you need to know the command line (console) and basic Linux because these servers are normally all based on the Linux operating system. If you have set up your masternode, you have to connect it with your local wallet (your wallet can be run on Windows). The setup process is described within the docs of a particular masternode project but you need to invest some time in the setup. If you are interested in it and don‘t know how to set it up, feel free to contact us – we can help you with it.

A good overview of the masternode projects you can find at masternodes.online. Sure, there are existing scams and many coins don‘t have a use case – just another masternode. You can cross reference the “JAM” website  if a project has a use case at all which is a good starting point. After that, you can filter the projects at masternode.online for their volume and their market capitalization. A high volume and market capitalization means that the project is established (market capitalization) and if you want to sell your coins, there are enough buyers for it (volume). If the project then has a cheap price, high volume, high market capitalization and an active community (Discord/Telegram), it‘s a good sign. An example project right now is SmartCash which matches all the above requirements. You then need to buy the collateral which is normally around 10000 coins, transfer them to your server, connect your local wallet and enjoy the “dividends,” the coins you get paid for your masternode service – validating the transactions. You can withdraw your “dividends” at any time, but if you withdraw your collateral, your masternode can‘t be used anymore.

Example: Currently our best performing masternode is TRTT. With an initial investment of $2500, we have been enjoying a passive income of $800 a month the last half year. But sure, you never know how long it will be like that, so always take profits.

3. POS/Staking

POS or Proof of Stake is different to the POW or Proof of Work of the Bitcoin Blockchain. Proof of Stake is much more energy-friendly than POW, you need to have some coins in your wallet which normally has to be online 24/7. These coins are functioning then as validators of the network and in return, you get “dividends,” almost the same as masternodes but the returns are not as high. An example of a staking coin is NEBL, a blockchain for business applications. You could run your wallet on a Raspberry Pi which is online the whole day and in return you get “dividends” in NEBL, about 10-20% a year. You also profit from a price increase of your coin.

4. DPOS/Delegating

Delegated Proof of Stake is another validation method, you simply delegate the right to validate the network transactions to someone with a huge stake of coins and in return, you profit off that. The most popular DPOS Coins are STEEM and ARK. With Steem, you can delegate your coins also to a bot service like smartsteem or minnowbooster and get daily returns in STEEM or Steem Dollars. Have a look on my Steem profile, I delegated more than 6000 coins to bots and enjoy a daily passive income.

5. Dividends

A real dividend generating Coin is NEO or recently VEN/VET. Just by holding NEO in your wallet, you generate GAS, another coin which is used for transaction fees in the NEO network. Your annual return is currently about 3-4%. You can check this website (https://neotogas.com) to calculate your possible gains.

More popular are exchange coins like COSS. Holding COSS is like a hyper-miner – the COSS exchange distributes 50% of their profits weekly to all COSS Token holders. You receive these “dividends” in all the coins listed on COSS. But you also have the opportunity to convert them to ETH so it will be easier for you to withdraw. You can calculate your gains here: https://www.cosscalc.com The trading volume is quite low so the dividends won‘t be so high. But the COSS team is working hard so I have faith in the project that one day they will be a much bigger exchange.

Lastly, there are Hedge Fonds. These coins are really interesting. The most lucrative coin is BCF. The project consists of a group of professional traders in the Crypto and Forex sector. They also have the option to short coins, so you even make profits in a Bear market where the price is going down. They trade for a huge amount of Dollars. After one month, they convert all the profits they make into ETH and distribute the profits among the Token holders. You get daily updates about the fund so you are always up to date. The community behind is also really nice and you get many insights about the different trading markets.

6. Dapps

Dapps (Decentralized applications) are applications on the blockchain but instead of a centralized app store they are decentralized and everybody can use them without the permission of an app store. A really nice Dapp at the time of this writing is Fomo3D. It consists of 2 parts, the Powh token, which generates dividends and the game Fomo3D. It sounds like a real scam but compared to one of the biggest “scams” in the crypto world (Bitconnect) it is an Ether smart contract so you know how it works. I don’t want to explain everything in detail here, if you are interested check out their website. If you want to invest in the Powh tokens we would be happy if you use our ref link but you can also buy them on the Fomo3D website. The project is really interesting and it could go forever. We are holding Powh Tokens and receiving hourly dividends.

Disclaimer: All these passive income ideas are not an investment advise! Please do always your own research. All the information here is only based on our experience.