One of the most attractive features of the crypto sphere is the opportunity to make a lot of money - more than one can on the traditional markets. Indeed, the crypto market is more volatile than traditional finance and offers multiple options to earn from, including passive ones: mining, capital growth investments, and staking. These can all be called passive income. In this article, we will look at cryptocurrencies that offer passive earning opportunities, excluding mining, as mining involves investing in expensive equipment rather than buying coins.
What Are Dividends in Crypto?
The concept of dividend income in cryptocurrencies differs from that in traditional finance. In TradFi, a dividend is a share of a company's profits sent to shareholders (stakeholders) as their reward for depositing money into the project/company. However, there is something similar in the crypto sphere as well: cryptocurrency issuing companies can send part of their operating income to their shareholders. However, when we talk specifically about cryptocurrencies, there are three options for crypto dividend income: capital gains from coin price appreciation, staking fees, and lending your crypto. These earning options can be called real passive income as they do not require any active activities on the investor's part. Look at some of the most promising coins that could bring crypto dividends in 2023.
Does Bitcoin pay dividends? Also, you can get passive income by lending out bitcoin assets or receiving airdrops. Speaking of nft that pays dividends, some projects pay for nft staking, but there are more stable ways to profit.
Top 10 Cryptocurrencies That Pay Dividends
1. VeChain (
When you ask, "do cryptos pay dividends" it is necessary to mention blockchain and cryptocurrency VeChain. It is an advanced blockchain for performing many transactions, storing transactions, and transferring data, as well as for the Internet of Things. VeChain is well suited for large companies to perform multiple transactions per unit of time. There are two tokens implemented into the project: VET and VTHO. Holders of VTO can put their assets in the staking pool and receive VTHO tokens as a reward. Since May 2022, VTHOs have held roughly the same price level, making investing in VET worthwhile.
2. Neo (
NEO is a blockchain and rapid ecosystem. The NEO network can process up to 10000 transactions per second, while in the Ethereum network, for example, this figure does not exceed 15. The project has two tokens: NEO itself and GAS. NEO owners can stake their tokens and get a reward in the form of GAS tokens. In the past year, the GAS token has been stable in its price, so investing in NEO can also be called good cryptocurrency dividends.
3. Bibox (
Bibox is an ERC-20 utility token, the proprietary (native) token of the Bibox exchange. It serves various purposes on the platform, including reducing users' commissions, access to exclusive trading opportunities, and more. To receive dividends from holding Bibox, you need to buy at least 500 BIX tokens. This allows you to receive weekly rewards. Rewards are paid in the form of Eth tokens, the amount of which depends on the number of Bix's you own.
4. Kucoin (
KCS is a token of the KuCoin exchange. The exchange offers token holders unique options and opportunities, including the KCS bonus, a daily dividend sent to KCS token holders in the form of 6 different tokens. The rewards accrue from 50% of daily trading commissions, giving users a steady, passive income. KCS tokens can also pay commissions for trading on the KCS exchange, which provides users with discounts of up to 80%. Buying KCS tokens is an excellent way to invest in crypto that pays dividends.
5. BitMax (
BitMax is a cryptocurrency exchange that rewards its token holders with BTMX tokens. The exchange allocates about 80% of all collected transaction costs to crypto dividends. The annual return is around 35-50%, which is passive income. That's much more than keeping tokens in a savings account.
6. Decred (
Decred (Decentralized Credit) is a multi-platform cryptocurrency that pays dividends as well. Its consensus combines Proof-of-Work and Proof-of-Stake protocols. The network's native token is DCR. Users who stake DCR earn an annual return of up to 30%.
7. Neblio (
Neblio is a blockchain-based platform that supports Dapps and smart contract development; ICOs can also be launched on this platform. Neblio stakers also receive rewards for staking the network's native token. The cryptocurrency shows an annual yield of about 10%. Considering the fact that the price of NEBL (Neblio's native token) is low, we can say that staking NEBL can be highly profitable in the long run.
8. Pivx (
PIVX is a network and a token. The network is popular because its privacy protocol allows users to send, receive and swap cryptocurrencies safely and privately. Among other things, this protocol makes the token one of the fastest-growing coins. Staking PIVX tokens brings its users as much as 4.8% annually.
The only drawback of PIVX is that the staker must always keep a node on the PIVX network enabled (it must be online). However, in this case, you can use cloud computing.
The Crypto Mastodons
To conclude the article, we discussed the most famous and popular coins at the very end. And yes, you're correct: these will be Bitcoin and Ether. These two coins are the most reliable investments in the crypto industry.
9. Bitcoin (
Does bitcoin pay dividends? Bitcoin is the most famous cryptocurrency, the #1. Strange as it is, it can also pay dividends. Having started its journey in 2009 with a price of 0.01 USD, Bitcoin now trades at $24,000, while its all-time maximum is $70,000. It goes without saying that the Bitcoin price grows at a much lower pace than it used to in the past. It is unlikely that the number-one-crypto will rise at tens of percent a year, but it has been considered a protective asset against inflation for many years, an attractive one to long-term investors.
Of course, the price of Bitcoin, like all cryptocurrencies, is highly dependent on the state of the fiat economy. For example, this was the case in 2020, during the Covid pandemic: the so-called "helicopter money" led to an influx of money into the crypto sphere, resulting in Bitcoin rising to $70,000. Another confirmation of this thesis, we can say, is the last year, 2022, when the Fed began quantitative tightening and raising rates: Bitcoin has been "dangling" around $20k for a long time. And again: now, in March 2023, there are signs of another quantitative easing by the Fed: bankrupt banks Silvergate Capital, Silicon Valley Bank, and Signature Bank are demanding the intervention from the authorities, which means another quantitative easing (and the resulting influx of money into the crypto industry) is just around the corner. When they start lowering the rate, Bitcoin could start rising strongly again, as well as other cryptocurrencies.
Of course, Bitcoin is a volatile currency, but those who bought it in, say, 2010 are satisfied.
The downside of Bitcoin is that it cannot be staked. It is not a virtual machine running on smart contracts; it is just a blockchain on Proof-of-Work that is well protected by numerous miners, allowing data storage within its registry.
10. Ethereum (
Ethereum is the best-known (and most popular) altcoin. It was the first network to offer smart contracts. Thanks to smart contracts, Ethereum has become one of the most convenient tools for building ecosystems. In particular, numerous NFTs have been created on Ethereum, which, among other things, pay dividends. Non-fungible tokens are an opportunity to buy an item of art at a low price and then sell it at a high profit. In other words, the Ethereum blockchain is a place for developing NFTs that pay dividends.
Apart from smart contracts, Ethereum also offers useful tools such as soulbound tokens. These are NFTs that are tied to a specific person or cryptocurrency wallet. And it's a good investment tool, too, as anyone can create their own soulbound token, develop themselves professionally, and develop their own skills to raise their soulbound NFT and get dividends from it.
Another exciting feature of Ethereum is the Ethereum Domain Service. This is a decentralized open-source technology built on the Ethereum blockchain. At its core, it is a name assignment system that allows wallet addresses, internet domain names, and smart contracts to be assigned readable names, such as your_name.ens. This makes it possible to create usable names and interact with them more easily. Domain names are also a way to generate dividend income. People who have registered nice and clear domain names now sell them to interested parties at high prices, earning dividend income.
Last year, Ethereum switched from Proof-of-Work consensus to Proof-of-Stake. This allows doing away with mining and using only nodes to confirm transactions. Yes, it takes a large amount of 32 Eth to run a node, but there are special services that allow you to enter staking even with an amount of less than 1 Ether. The yield from staking is currently around 4% per annum.
In the long run, Ethereum offers excellent opportunities for dividend income. For example, in 2015, when the Ethereum network was first launched, the coin was worth less than a dollar, but now its price is more than 1,600 USD. That's a great return, isn't it? Many early investors made a fortune on investments in Ether.
So, even good old Ether can be a good tool to receive dividends in the long run.
The crypto industry offers numerous options for dividend income. This article only looked at selected cryptocurrencies that provide dividends to their owners. However, there are other ways to make a profit from the crypto sphere:
- DeFi strategies - liquidity farming, lending protocols, arbitrage, and a combination of these options;
- Investing in NFTs, which can also pay dividends;
- Airdrops - coin giveaways in the early stages of project development. Whole communities on the net follow new airdrops and make money from them.
Summing up, do cryptos pay dividends? Absolutely. Moreover, cryptocurrency dividends are among the most attractive ways to generate passive income from cryptocurrency holdings. Even though trading can bring more profit than dividend income, the risks are also much higher.
Actually, these are not dividends but rewards for holding cryptocurrency or performing specific actions with digital assets that provide a stable passive income. These investments are associated with minimal risk and can bring good dividends. Choosing the right coin and carefully checking all the conditions to get rewards is essential.
However, cryptocurrencies are notoriously volatile and can significantly change your predicted dividend payouts. That is why it is essential always to consider the project first and then dividends.