Ways to Make Money with Cryptocurrencies: From Basics to Derivatives

In 2026, making money with cryptocurrencies is no longer exclusive to technologists and speculators. Small savers, investment funds, and governments are distributing the trillions of dollars in the digital ecosystem seeking profitability and real-world applications. With a global market capitalization exceeding $3 trillion and over 653 million active participants, cryptocurrencies have established themselves as a mature ecosystem offering multiple paths: long-term accumulation, automatic staking, DeFi protocols, and yes, also derivatives instruments for those seeking more aggressive returns. If you’re looking to make money with cryptocurrencies quickly, there is no magic formula. But in this analysis, we break down the main strategies with real data, concrete cases, and tools to help you identify which one is yours.

The two dimensions of profit: active vs. passive

Gaining profits with digital assets means generating economic benefit through buying, managing, or locking cryptocurrencies. But there is a key factor that divides the universe: do you want money now or money later?

Active approach: your time and attention are the critical assets. Trading is the clearest example: seeking short-term profitability from price movements, but if you look away, you stop earning (or start losing). This also includes financial derivatives, where both gains and losses are amplified.

Passive approach: you invest initial capital and aim to generate recurring yields without being glued to screens. Staking, lending, and yield farming work this way: your money works 24/7, generating interest while you do something else.

Classification of methods by risk exposure

To navigate this terrain, categorize strategies according to the risk you’re willing to assume. Remember that “low risk” in crypto always involves higher volatility than traditional markets.

Conservative profile: safety over multipliers

Focused on maintaining positions and extracting moderate but steady yields.

• Examples: staking stablecoins (USDC yields around 5-10% annually), “Earn” products on exchanges, or accumulating Bitcoin ($66,960 currently) and Ethereum ($1,940 now) long-term via Dollar Cost Averaging.

Moderate profile: balance between security and control

Looking to beat the market with more active management. Requires medium technical knowledge but offers a better balance.

• Examples: providing liquidity in stablecoin pools, diversified portfolio in top 10 cryptocurrencies, swing trading over days.

Speculative profile: volatility and derivatives

Here, derivatives instruments and high-risk bets come into play. Advanced technical knowledge is required.

• Examples: leveraged trading (futures), buying memecoins, providing liquidity in unverified DeFi protocols, participating in low-cap IDOs, options, and sophisticated derivatives.

The ultimate question: can you sleep peacefully if your portfolio drops 10-50% overnight? If not, speculative methods are not for you.

Main ways to generate income

The market has matured so much that there is no single answer. A conservative investor earns interest month by month; an aggressive trader multiplies capital in hours. Here are the options ordered by frequency of use:

Trading and financial derivatives: quick profitability, extreme risk

This is the option that attracts those seeking to make money with cryptocurrencies fast. The logic is simple: sell higher than you bought, in short timeframes.

Modalities:

• Day Trading: open and close within the same day
• Scalping: trades resolved in minutes
• Swing Trading: holding positions for days or weeks
• Leveraged derivatives: futures and options amplifying movements

Derivatives multiply both sides. A 2% gain in Bitcoin becomes 10% with 5x leverage. But a 2% loss turns into a 10% loss. Historical data shows most traders lose money initially.

Realistic profitability: if everything goes well, expect 5-10% per month. With properly positioned derivatives, more. But one or two mistakes can wipe out your account.

Risk: extreme volatility. Regulatory news or a tweet can change the market in seconds. With leverage, a forced liquidation leaves you with nothing.

Advice: never use leverage as a beginner. Learn basic technical analysis (supports, resistances, moving averages) in simulators before risking real capital.

HODLing: the patience philosophy

If trading intimidates you, HODL is your ally. The term originated from a typo in 2013 (“HODL” instead of “HOLD”) but has become a serious strategy: buy strong assets and hold them for years, ignoring daily fluctuations.

How it works: buy established cryptocurrencies (Bitcoin, Ethereum, Solana) with conviction that they will appreciate over years. Gradually accumulate without obsessing over daily prices.

Historical profitability:
Bitcoin: reached all-time highs of $126,080; those who bought in 2017 and still hold have multiplied their investment.
Ethereum: from $0.30 in 2014 to $1,940 today.

Main risk: psychology. When the market drops 50% (which happens in every bear cycle), panic will tempt you to sell at the worst moment. There’s also the risk that a project disappears.

DCA strategy (Dollar Cost Averaging): instead of investing €10,000 all at once (risking it drops later), invest €200 each month. This smooths out long-term cycles without stress.

Staking: automatic interest for holding

Think of it as dividends for owning shares, or bank interest but 50 times higher. Lock cryptocurrencies in a Proof-of-Stake network (Ethereum, Solana, Cardano) to validate transactions. In return, you receive rewards in the same currency.

Yield: depends on the protocol. USDC offers 5-10% annually. Ethereum typically 3-4%. New projects offer more (20%+) but with higher risk.

Slashing risk: if the validator fails, you lose part of your capital. If the price drops more than your interest gains, your euro balance decreases.

Real example: 10 ETH at 4% annually gives 10.4 ETH per year. But if Ethereum drops 40%, you have 6.24 ETH (6 ETH × 1.04). The token gain doesn’t compensate for the price decline.

For beginners: use “Earn” directly from exchanges. Simpler than private wallets.

Yield Farming and DeFi: earning in liquidity pools

This is advanced territory. You contribute tokens to a “pool” (liquidity fund) on decentralized exchanges. Others trade in that pool, generate commissions, and you get a share.

Profitability: can reach 100%+ annually in new projects. But volatility is extreme.

Major risk: Impermanent Loss.
If you add 1 BTC + $50,000 USDC to a pool, and Bitcoin’s price triples while USDC stays stable, the pool automatically rebalances: you end up with less BTC and more USDC. You’ve “lost” the upside. Mathematically complex, but the result is that you can lose money even if both assets go up.

Advice: start only with stablecoin pools (USDC-USDT). No impermanent loss risk, though yields are lower.

Airdrops and rewards: free money (if lucky)

Some projects give tokens to early users to incentivize adoption. In 2020, Uniswap gave 400 UNI tokens to anyone who used the platform. At its peak, those tokens were worth $16,000.

Reality: varies greatly. Some airdrops are worth €5; others thousands. But require time interacting with protocols and risk of scams.

Advice: follow trusted crypto accounts, participate in testnets (test networks without real money). Never connect your wallet to suspicious sites.

NFTs: digital art and speculative collectibles

NFTs are unique digital assets. You can create (mint) your art and sell it, or buy collections hoping to resell at a higher price.

Market reality: highly speculative. Someone bought an NFT at $200 and sold it at $200,000. But such cases are rare.

Major risk: illiquidity. Unlike Bitcoin (sold instantly), an NFT requires finding someone willing to buy. You might get stuck with a digital file nobody wants.

Important: community backing gives value. Buy for utility or status, not just for the art.

Play-to-Earn: earning by playing games

Blockchain-based games where you earn tokens or NFTs by completing missions. In strong economies, it’s extra money. In emerging markets, it can be a full salary.

Problem: these economies are inflationary. If everyone sells tokens simultaneously, prices collapse and playing stops being profitable.

Advice: play only if you enjoy the game. If you’re only in for money and find it boring, it’s probably unsustainable.

Understanding why some methods yield more than others

A bank deposit yields 0.5% annually. Staking USDC yields 8%. A speculator can gain 300% in a week with a memecoin. What explains such differences?

The fundamental equation: Risk = Reward

In finance, nobody gives away money. If something yields 300% annually, it’s because losing everything is equally likely.

• Low returns (3-5%): come from safety. Ethereum is unlikely to disappear. Bitcoin has 3 million users and backing from governments. Minimal risk, low return.
• High returns (100%+): come from uncertainty. New projects have low liquidity. Small trades move prices significantly. But whales selling can crash it to zero in minutes.

Liquidity and volatility

Cryptocurrencies are volatile because the market is small compared to stock markets. Imagine a small pool: if someone jumps in, water spills over (price rises). If they jump out, it drains (price drops). Expert traders surf these waves; beginners drown.

Tokenomics: scarcity vs. inflation

Bitcoin has a cap of 21 million coins. It’s like digital gold: scarce. A token that prints millions daily is different. Long-term winners focus on scarce assets. Quick gains often exploit hype regardless of real utility.

Market psychology: FUD and FOMO

Fear (FUD) and greed (FOMO) drive prices more than technology. Experts buy when there’s fear and sell when euphoric. Large institutions accumulate at lows and sell at peaks.

Real cases: lessons from gains and losses

The Winklevoss twins: institutional patience (2013-2026)

The twins invested €11 million in Bitcoin when it was $120. Everyone called them crazy. They didn’t trade; they saw disruptive tech, bought, and held through years, enduring 80% drops. Today, they’re multimillionaires.

Lesson: they didn’t seek quick gains. Patience and conviction, not luck, built wealth.

Uniswap Airdrop: being in the right place (2020)

On September 17, 2020, Uniswap surprised its community. Gave 400 UNI tokens to each wallet that used the platform. At that time, $1,200 per user. Months later, those tokens were worth over $16,000.

Lesson: earning money without direct capital is possible if you invest time and curiosity in new tech before the masses.

Ethereum staking: silent compound income

Thousands of anonymous users have accumulated Ethereum since 2018 without selling. By staking, they earn about 1 ETH annually per 25 ETH. If Ethereum appreciates, that interest becomes more valuable.

Lesson: compound interest works in crypto too. It’s not spectacular, but steady.

Dogecoin: timing trap (2021)

A user invested all savings in Dogecoin before Elon Musk appeared on Saturday Night Live. His portfolio hit millions. He didn’t sell, expected more. Price plummeted. He lost his chance.

Lesson: you don’t earn anything until you sell. Managing exits is as important as entry.

Practical steps to start today

1. Choose a solid platform

Use a secure centralized exchange with insurance funds (SAFU) and good liquidity. Check monthly Proof of Reserves. Enable 2FA (Google Authenticator).

2. Complete identity verification (KYC)

It’s not bureaucracy: it protects your funds in a regulated environment. Serious platforms require it.

3. Define your strategy BEFORE investing

• Will I do daily trading?
• Do I want long-term accumulation?
• Am I seeking monthly passive income?

Having a plan prevents impulsive decisions (the biggest enemy in crypto).

4. The golden rule: never invest money you need

Markets can drop 50% in a week. Start with an amount that, if lost, hurts pride but not life. Scale gradually as you gain experience.

5. Diversify your portfolio

• Solid base (70%): Bitcoin ($66,960) and Ethereum ($1,940)
• Medium opportunities (20%): top 10 cryptocurrencies
• Speculation (10%): altcoins and experimental derivatives

Don’t bet everything on the trending coin promising x100. That’s lottery, not investment.

How to start with little capital

A huge advantage of crypto vs. traditional stocks is divisibility. You don’t need a full Bitcoin. You can buy 0.00000001 BTC (a Satoshi).

The power of decimals

Many exchanges allow starting with €10-20. With €50, you can build a diversified portfolio: BTC, ETH, and another top 10 coin.

Dollar Cost Averaging (DCA): smart strategy

Instead of waiting €1,000 to invest, put €20 weekly. You get a competitive average price and avoid stress over perfect timing. It’s the smartest way to start with small capital.

Step-by-step approach

1. Months 1-3: build a solid base in BTC and ETH
2. Months 4-6: experiment with staking in USDC or audited protocols
3. Months 7-12: if experienced, consider yield farming or swing trading
4. Later: evaluate if leveraged derivatives make sense for you

Managing fees

If you invest €10 but pay €2 in fees, your margin is tight. Look for exchanges with low fees until your capital grows.

Is it a good time to start in 2026?

To know, forget today’s price and understand where we are in the cycle.

Bull vs. bear markets

Bull market: prices rise, euphoria, green charts. Novice mistake: invest everything with FOMO. Smart strategy: take profits gradually.

Bear market: prices fall, panic. Novice mistake: sell out of fear. Smart strategy: accumulate quality assets at discounts.

Current ecosystem maturity

Compared to 2017 or 2021, the current market is different. Extreme volatility has softened due to institutional capital (BlackRock, Fidelity, VanEck). Maybe we won’t see x30 in Bitcoin in a month, but we gain security.

Conclusion: if you invest long-term with DCA, it’s always a good time to start.

Expert perspectives and institutionalization

Unstoppable institutional capital inflow

Executives from BlackRock, Fidelity, and VanEck state that digital asset digitization is the future. They don’t speculate on tomorrow’s price; they see efficiency in global transactions via blockchain.

Regulation as an ally, not enemy

Clear legal frameworks (like MiCA in Europe) are positive. They eliminate uncertainty and open the door to large capital inflows.

Bitcoin as a reserve asset

Figures like Larry Fink (BlackRock) and Paul Tudor Jones compare Bitcoin to gold. In a world of rising inflation and government debt, a scarce, decentralized asset adds value.

Projects with real utility will survive

Vitalik Buterin (Ethereum) insists: only projects with real utility will survive, beyond their token price.

Advice: avoid influencers shouting on YouTube with emojis. Seek information from CoinDesk, Cointelegraph, Bloomberg Crypto. Follow analysts who use on-chain data, not gut feelings.

Taxation and security: what you need to know

Taxes in Spain

• Exchange is a taxable event: swapping BTC for ETH triggers capital gains/losses for tax authorities.
• IRPF brackets: gains are taxed at 19-28% depending on amount.
• Staking and yields: considered as Capital Income.
• Form 721: if you hold crypto on foreign exchanges over €50,000, declare it.

Crypto security: shared responsibility

• Use exchanges publishing monthly Proof of Reserves.
• Always activate 2FA; create anti-phishing codes.
• For daily operations, keep funds on exchange (safe and practical).
• For full control, consider self-custody in a private wallet.

Remember: in crypto, you have total freedom but also total responsibility.