Before we start, this is not financial advice, and we clearly want to state that. Do you know why? As we wrote a similar article in 2021, our advice was mostly crappy, at least if you followed a couple of our suggestions. Does that make us bad investors? Maybe! But, I guess lots of other people also come with suggestions that didn’t turn out well, but they might not be brave enough to highlight it in their tweets and articles. But, we do not give up, and here we would like to give you some suggestions for passive income sources in the crypto world that might give you a constant stream of extra income!
A short wrap-up of our suggestions for 2021
Before we get started, let us just mention with a few words the five protocols we mentioned in our article in 2021, and also sum up whether our suggestions were a success or not.
- Easiest platform: Nexo (SUCCESS)
This was the lowest bar suggestion because you only have to deposit your crypto and receive an interest on your coins between 5% and 20% (depending on which tokens you have on the platform). This is actually a brilliant solution also in 2022, with low risk and with an interest easy to understand and trust. - Create a node with Strongblock (SUCCESS FOR SOME)
Our second suggestion was creating a Strongblock node. If you created a node back then, you would have gotten your entire investment in return plus more by now, but if you waited a bit, you would have bought your STRONG tokens at a way higher price than the current, meaning that you might still struggle to reach your return of investment. However, as your node would still be generating rewards daily, this would still be a good solution. But, is Strongblock worth considering in 2022? Click the link to read our thoughts. - Farming with Penguin Finance (NOT THE BEST)
This was a good option back then, and it still is, but it is a sad truth that the PEFI token (PenguinFinanceToken) has dropped a lot in value and it is currently trading at $0.2 (instead of $2 which it also reached). You can still earn very nice rewards if you partake in the PenguinFinance farms, but due to the drop in the price of PEFI, there is a risk that many investors might have lost money if they bought PEFI tokens on the top. - OlympusDAO – crazy APYs, and crazy risk (SUCCESS FOR SOME, BUT FAILURE FOR MANY)
Now, this is a special one. We actually have an OlympusDAO fork experiment running in the IP Address Guide, and it has been tragic (if you look at the results). If anyone bought OHM tokens in September 2021, they would probably be in a little loss right now, but not a big one (due to the incredible APY of the protocol). But, if you waited and bought your tokens in October or November or December 2021, then you would be in a major loss right now, probably around 80% which is tragical. OlympusDAO isn’t the only rebase token to suffer like this, in fact, they all are. During the hype, it was hard to predict that they would all fall so hard, but it is probably proof of the fact that such an APY is impossible to keep, no matter how brilliant the masterminds behind it might be. The fact that Wonderland also had giant trouble (the second biggest protocol) and used a former criminal to oversee the treasury didn’t help the reputation of the rebase tokens either. - Staking with Kraken (SUCCESS)
The final suggestion on our list was to simply stake tokens on Kraken. This is quite similar to staking them on Nexo, meaning that this is a brilliant option for those who want a slow, but steady, stream of interest on their cryptos. And since your plan is to keep the crypto anyway, then you cannot be in loss because the interest on Kraken is received in the currency that you stake, meaning that you will only grow your current holdings (which you planned to hold anyway). In other words, this is a great option also in 2022.
So, that was a short review of our suggestions for 2021. But, what would we suggest in 2022? We cannot guarantee that these suggestions will be better than those for 2022, but we do hope so. Let’s get started!
Where to invest to grow a stream of passive income with cryptocurrencies in 2022?
The world is an insecure place and we do not really know what to expect of the future. What will happen with the world economy as Russia attacks Ukraine? Will China be involved in any kind of way? Will cryptocurrencies boom as people try to avoid SWIFT regulations and possible SWIFT sanctions? There are many uncertainties. It is also important to follow the trends. Just like the rebase tokens turned very trendy in July-September 2022, the hype disappeared from December 2022. Those who sold then were in giant plus, but those who bought then or who didn’t sell then might still be in loss.
Then came the node hype that followed the success of Strongblock. Lots of node protocols launched in November-December 2021 (and they are still launching), but how long will the hype last? These might give incredible gains (if the trend/hype stays alive), but if not, these might cause giant losses for many. It is also important to be careful, because we hear about node protocols rugging almost daily, meaning that it is important to invest in teams and protocols that you really trust.
1. Invest in your stablecoins – Nexo, Platypus (Avalanche), Anchor (Terra/Avalanche), Kraken
The first suggestion if you really want to grow some passive income without taking a big risk is to invest in your stablecoins. What does that mean? Instead of buying lots of tokens, own stable coins and just stake them on platforms such as Nexo, Platypus Finance, Anchor Protocol, and/or Kraken for a steady income. With Nexo, you can directly deposit Euro and USD and receive interest on your FIAT currencies without even converting it to a stable coin (crypto). On Platypus Finance and Anchor you can stake your stable coins and earn a boosted interest, and on Platypus Finance you can easily achieve interest rates above 30% if you also own some PTP tokens that will generate vePTP tokens that again will increase your interest boost (above the flat interest rate normally moving between 5% and 8%).
These are all low-risk investments. They might not have the highest return, but the risk is very little at the same time. Anchor Protocol was for a long time only available on the Terra blockchain, but you can now enjoy the 19,5% interest on your UST stable coin also on the Avalanche blockchain.
2. Invest in NFTs generating passive income – Cryptopuffies
We often feel as if NFTs in general are incredibly over-hyped. But, there are some use-cases for NFTs that make them interesting seen from the perspective of passive income, and the Cryptopuffies should come as an example of that.
The price of a Cryptopuffy is 2 AVAX and there is a maximum of 8888 Puffies available. When you own a Puffy, you can stake it on the platform and receive a weekly reward of approximately 0.05-0.09 AVAX per week. A worst-case scenario is generating 0.05 AVAX per week with your Puffy, which means that it will take 40 weeks to get your 2 AVAX in return. But, that is a worst-case scenario, and one should not forget that you still own your NFT, meaning that you can sell it at any time. If you are lucky, you can sell it for more than the original 2 AVAX, if not, you can sell it for less and still be in profit considering that you have generated AVAX rewards it through staking until the time of selling.
The Avalanche blockchain is also very popular, meaning that we do expect the price of the AVAX token to increase, which means that your initial investment of 2 AVAX (currently worth $160) might be worth way more by the time you have received your initial 2 AVAX in return through the passive income generated with the puffies.
No matter what, this is also a quite low-risk project (as the team is doxxed by AvaLabs and it is made up of early supporters of the blockchain). The entry is also low (2 AVAX), meaning that even though something should go wrong, you haven’t lost a fortune.
These were the low-risk investment opportunities -> Time for crazy gains or possibly, crazy loss!
Until now, we have mentioned projects with low risk that will give you a steady flow of rewards/income/interest. But, if you want to take bigger risks there are also bigger losses/gains available. Do your own research before investing in any of these!
3. Node projects -> Strongblock, Phoenix Community Capital, Thor Financial
Nodes are really hyped right now and they have a big potential, but also a big risk. Here we will give you three projects that we do believe in, but they all come with risk.
Strongblock is the mother of them all, and it is led by David Moss, a highly respected character in the blockchain world. He has turned Strongblock into one of the most used projects on the Ethereum blockchain, and even though all other protocols should fail, this is most likely to stand. The price has dropped a lot recently, meaning that the price of 10 STRONG (required to make a node) at the moment is below $2000 (for the ten tokens in total). The rewards should give you those 10 STRONG tokens in return within 100-110 days. Strongblock has their very own chain, StrongChain coming up in 2022, and they will also add an additional token, STRONGER. It is hard to predict what will happen and how this will influence the price, but David Moss is a legendary guy in the blockchain world, so we choose to trust the future of this protocol.
Phoenix Community Capital is very hyped at the moment, meaning that there is a risk that the price might drop a lot. The current price is $230 per token, and with the current model, 10 FIRE is required to create a nest. When you have created your nest, it will take 45 days (with the current rewards) to receive your initial investment of 10 FIRE in return. A reward cut should be expected, but so far, we do not know anything about it. The Phoenix Community Capital team is doxxed and they have a lot of support from the Ripple community and other “stubborn” investors. In other words, this has great potential, and it is a node/nest protocol we trust. The downside is that you need more than $2300 to do your initial investment which makes the barrier very high and the risk even higher.
Thor Financial is the last node protocol that we want to recommend. They have just released the protocol with an entirely new contract (it is no longer a fork), and they are constantly trying to work on the protocol, develop it, and make it sustainable. The price is very volatile, meaning that it has been moving between $30 and $200 quite a lot. The current price is $40, making it a low barrier protocol to enter as they have four different node options available.
At the time of writing, there are more than 160,000 THOR nodes created. This causes a big sell pressure, which might harm the price, but with the release of the v2 contract, they are hoping to fight this back. In comparison, Strongblock has nearly 400,000 nodes, while Phoenix Community Capital has 20,000 nodes.
All these node/nest protocols come with a high risk, but they might also give you big rewards. Do a lot of research, and never invest money that you cannot afford to lose.
This article is still in production and we will update it with even more projects and passive income opportunities as we discover new options. If you have any comments, thoughts, or insight that you feel like sharing, please use the comment field below.
