How to make a passive income from your Bitcoin  

Lendo

Bitcoin 3 years ago
1 QCP
Post Image
Andreas Antonopoulos, a highly respected digital assets educator has identified a new way for those who are HODLing their BTC to make a passive income, Cointelegraph reports.

His solution lies in the use of decentralised finance (DeFi). “In a livestream Q&A on Antonopoulos’ YouTube channel on June 27, he said decentralized finance (DeFi) contracts were one way for Bitcoin (BTC) owners to generate passive income without relinquishing custody of their coins.”

In the video, Antonopoulos said that anyone holding BTC could convert them into ETH or a stablecoin, then lend those tokens to a platform where they can earn interest. However, he did add that there are some risks. He said: “Ethereum may have problems. It may have bugs. The consensus algorithm may have failures. You may have increases in the gas price, which leads to other cascade problems. And all of those things can cause you to lose some or all of your invested capital.”

He did mention other ways of making crypto holdings work for owners, but almost every method does involve relying on a custodial exchange, and these do carry the risk of theft or mismanagement.
However, HODLers do not earn dividends or interest on their investments until they finally decide to cash out, as he pointed out, and while BTC owners are always hoping the price will go up, it can also go down. Antonopoulos said the same was true for crypto day traders: “You can pull your Bitcoin out and convert it, buy 1,000 altcoins, and then watch them crash by 98%.”

Antonopoulos is not the only person in the crypto space to advocate the use of DeFi for a passive income. Cointelegraph reported in March that OKEx Director of Financial Markets Lennix Lai said: “The combination of cryptocurrency and DeFi creates an alternative way for users to earn passive interest that was not possible before.”

...

https://medium.com/@lendoplatformltd/how-to-make-a-passive-income-from-your-bitcoin-3cde30b6f027
  • Bitcoin Maximalist
  • Bitcoin
  • BTC
  • Earning
  • Passive income