How to Make Money with Altcoins

What You Need to Know About Trading Altcoins
By 
Coin Cloud Team
, published on 
May 26, 2021
How to Make Money with Altcoins

So, you finally got the hang of Bitcoin. You’ve been using it for a little bit and you’re starting to feel some confidence. Wait… what’s this? There are thousands of other digital currencies that I also have to master?

Yes, there are THOUSANDS of other options called “altcoins.” Again, maybe you’re a seasoned Bitcoin trader, or maybe you’re being brave and jumping into altcoins head first. Either way, it is astonishing how many altcoins there are. Altcoins are entirely different from Bitcoin, and there’s a lot to consider when thinking about trading and making a profit off of them.

What Are Altcoins?

First, let’s identify what altcoins are. While you might be looking for a specific or detailed answer, there really isn’t one. Altcoins are any other digital currency besides Bitcoin. Since Bitcoin set the precedent for most of these altcoins and continues to be more popular, they are separated by definition. But that doesn’t really give you much help on how to trade them, or even make money from them.

The key is to self-educate. As I mentioned before, there are thousands of different altcoins, each with their own quirks and perks. Some of the most popular altcoins you might have heard of already include Ethereum, Litecoin, and Bitcoin Cash.

Bitcoin Cash specifically is a great example of why altcoins are “alternative coins” to Bitcoin. Bitcoin Cash was explicitly created as a solution to some of the issues the community thought Bitcoin had. As a result, a fork off the Bitcoin blockchain was created, thus birthing Bitcoin Cash.

Almost every altcoin has a meaningful reason for creation (except perhaps Dogecoin, initially conceived just to make fun of altcoins). It is important to understand these reasons if you are trying to trade them or predict their individual markets.

How to Make Money with Altcoins

The concept of making money with altcoins is the age-old “buy low, sell high.” It sounds obvious, but many new traders buy high (when everyone is talking about the asset) and sell when the price drops (because some celebrity said something negative about it). With some projects, like many DeFi tokens, you can also choose to stake currencies for others to borrow, and get paid for the lend. And sometimes getting in early means you’re given some free coins that you can hold with the expectation of rising value down the road.

So the question of “how to make money with altcoins” doesn’t really have a solid answer. There are so many different varieties of altcoins, each with their own properties. There are even subcategories to try and help organize all of these altcoins. Stablecoins, smart contracts, and DeFi are all more specific classifications of altcoins that can help you find the type you’re looking for.

Despite the lack of a very concrete answer to making money with altcoins, there are plenty of resources to help you find your own way to make money. Those include entire forums and online groups dedicated to sharing information and content about these different types of digital currency. Groups such as Reddit’s r/altcoin provide lots of support and information for those wanting to get into altcoins.

Altcoin Projects

One of the noticeably effective ways that altcoin enthusiasts have found profit is by closely following new projects (basically altcoin startups) and changes occurring in already established projects. By watching these events, whether it be a change in administration over an altcoin or a switch in the blockchain it runs on, investors can observe these changes and carefully place their funds accordingly.

Following these projects sounds like a lot of work, but it isn’t always as hard as you might think. You can find information on various forums like the altcoin subreddit or Facebook groups that focus on similar things.

So, like with Bitcoin, the key to making money with altcoins is to research, educate yourself, and keep up to date with the market and the groups that drive them.

When you decide on a coin you’d like to try, chances are Coin Cloud offers them. We invite you to make your purchase with cash at any Coin Cloud DCM, or online with debit or credit card.

Disclaimer: The information and views supplied on the Coin Cloud blog are for educational and entertainment purposes only. We are not financial advisors, so please do your research and consult with a trusted financial specialist before investing your money.

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