Recently, I’ve noticed more and more people asking how cryptocurrency can help them make money. In fact, this question is much more complex than most people think. Many beginners believe they can only earn money through trading, but the reality is that this market is far more diverse than you might imagine.

I think it can be viewed in two main categories. One is completely free ways that are suitable for beginners who have time; the other requires some capital investment, but the returns are relatively more stable.

Let’s start with the free options. Claiming airdrops is actually quite common. Project teams either ask you to complete certain tasks—such as registering an account or interacting on-chain—or they let you passively earn rewards just by holding a specific token. For example, people who held Bitcoin in 2017 later received BCH airdrops, and in 2022, during the Ethereum merge, people who held Ethereum also received ETHW. Nowadays, getting airdrops is no longer just a one-off thing—many KOLs share quality projects in Telegram or Discord, and following their pace usually won’t go wrong.

X to Earn has been hot in recent years. In plain terms, it means earning virtual currency rewards by completing tasks, including making money by playing games, earning by exercising, and earning by watching videos. Projects like Axie Infinity and STEPN are representative examples. But note that these games usually require you to invest some money upfront to buy equipment, and as more people join in, the rewards tend to decrease.

SocialFi is also an interesting direction. Simply put, it combines social activities with finance. You can earn virtual currency rewards by creating content, liking, commenting, and other social interactions. If you’re a creator, you can publish content on Mirror or Twitter to get fan tips; if you’re just a regular user, you can also earn platform coins through sharing and engaging on certain platforms. The advantage of this approach is that there’s no investment barrier. But to be honest, token prices are often not very ideal, and creators without fame find it hard to receive tips.

Creating NFTs is another possibility. An Indonesian man turned his selfies taken from ages 17 to 21 into NFTs and sold them, with trading volume reaching 400ETH. All you need is original work and a wallet, then upload it on platforms like Opensea. The risk is that nobody might buy them, and it may also involve legal issues.

Now let’s talk about more effective ways to make money. Mining with mining rigs is a classic option—you mine Bitcoin, Litecoin, or Filecoin using specialized hardware. Output is relatively stable, so it’s considered passive income, but the upfront cost is high and the payback period is long, which isn’t something ordinary people can easily play.

DeFi mining doesn’t require mining rigs. You can contribute to decentralized finance—for example, by adding liquidity or providing collateral for borrowing—and in return you’ll receive virtual currency rewards. DEXs like Uniswap or lending platforms like Compound both have corresponding products. The rewards are indeed substantial, but the risk level is also high and it requires professional knowledge—especially to be careful about the liquidation risk in collateralized borrowing.

Holding coins to earn interest is a relatively mild option. Like bank deposits, you deposit your coins into a certain large exchange and earn interest. There are both flexible and fixed-term options: flexible lets you withdraw whenever you want, while fixed-term requires waiting until maturity. It’s easy to operate and has low risk, but the returns are also relatively low—sometimes the interest can’t offset the loss from a drop in the coin’s price.

Buying low and selling high is the most direct approach. Right now, the price of Bitcoin is around 76.78K USD, Ethereum is at 2.10K, and Dogecoin is at 0.10 USD. By buying low and selling high through exchanges, you profit from the price difference—this is spot trading. If you want to do short-term swing trading, the returns may be limited; holding coins long-term is a more reliable strategy. Just be sure to choose a trustworthy trading platform.

Futures contracts are a high-risk, high-reward way to play. With just a small margin, you can open leveraged trades and go long or short. This approach is exciting, but it’s also extremely dangerous: you could face liquidation, resulting in your principal becoming zero, and it requires very strong trading psychology.

Finally, there’s arbitrage. The price of the same coin differs across different exchanges. If the price gap is large enough, you can buy on the lower-price platform and immediately transfer to the higher-price platform to sell. But be careful about trading fees and withdrawal fees—your price difference must be enough to cover these costs in order to profit. This method has low risk and stable returns, but opportunities are relatively rare and you need fast hands.

In general, how to make money with cryptocurrency comes down to finding a method that fits you. Some people are suited to free “freebie” opportunities, some are suited to holding long-term, and others are obsessed with short-term trading. The most important thing is to understand the risk and return characteristics of each method and not blindly follow trends. Beginners can start by learning—many trading platforms offer a paper trading or demo trading feature, letting you practice with virtual funds first. Once your skills improve, entering with real money will be more steady and reliable.