How to Make Money in Cryptocurrency: Steps and Records
Earning crypto carries no promise of profit: routes include staking, lending, mining, airdrops, and paid work. Check state licenses and keep tax records.
Vahe HakobyanEditor-in-chief
Updated Oct 5, 20263 min readFact-checked
- No route promises crypto income.
- Match route to time and risk.
- Check licenses and security.
- Use two-factor authentication and a whitelist.
- Treat promised returns as a scam sign.
You can make money in cryptocurrency through staking, lending, mining, airdrops, and paid work, but no route promises a profit. This guide covers choosing a route, checking a platform, securing an account, and keeping records. To create a token instead, see the How to Make a Cryptocurrency guide.
What you can do to earn crypto
Common routes are staking, lending, mining, airdrops, and paid work. Staking usually runs on a proof-of-stake network like the Ethereum blockchain and pays rewards that change with activity. Mining uses hardware and power, while airdrops and paid work pay tokens for tasks. Income can fall to zero.
Before you start
Choose a route that matches your time, risk, and skills before funding any account. Compare exchanges and wallets by state licensing, asset support, and security features. US exchanges usually need state licenses; New York's BitLicense dates to 2015.
Steps to earn crypto
Set up security before you send or earn anything. These steps work for an exchange account or a self-custody wallet.
- 1Open the account directlyType the web address yourself instead of using a link from a message or ad.
- 2Turn on two-factor authenticationUse an authenticator app or a hardware key. Text codes are easier to intercept.
- 3Set a withdrawal address whitelistApprove only addresses you control. A new address may wait before it can receive funds.
After you earn
The IRS treats cryptocurrency as property, so track every transaction, reward, and payment for US taxes. Record the date, asset, and dollar value at receipt. Treat promises of specific returns as a warning sign.
Frequently asked questions
Many airdrops need no purchase, but some require gas fees or tokens. Paid work needs none, and staking usually needs coins.
Staking locks coins to secure a proof-of-stake network. Lending supplies coins to a borrower or platform for interest.
Simple lending usually risks only the coins you supplied. Borrowing against collateral can create debt larger than it.
Report rewards as ordinary income at the value received. A later sale can create a capital gain or loss.
