Generating a consistent monthly income stream through investments is an important goal for many investors. The standard ways of achieving this goal through stocks, bonds, annuities, and savings accounts often fall short, with interest rates and dividend yields near historic lows. It takes huge effort and time to get the bonanza profit from it. That is why it has led investors to study alternative sources of income through emerging assets like cryptocurrencies, non-fungible tokens (NFTs), and options trading strategies. While these alternative investments come with higher risks and volatility, for those with the right risk profile, they offer the potential for significantly higher rewards.
Cryptocurrencies, NFTs, and option premium strategies are still in their early stages and come with unique risks related to security, liquidity, and market fluctuations. However, investors willing to participate in these developing markets and technologies can generate income through crypto staking and lending, NFT royalties, writing covered calls, participating in mining and staking pools, and selling option premiums. Success will depend on research, strategy, risk management and patience. But for those seeking to diversify beyond traditional income sources, cryptocurrency, NFTs, and options present compelling possibilities.
Here are some available which can use for the monthly income.
Cryptocurrency Staking and Lending: Many cryptocurrencies offer rewards for simply “staking” your coins by locking them up to validate transactions on the network. Staking rewards can range from 5% to over 20% annually, paid monthly. You can also lend your coins on platforms like BlockFi and Celsius, which pay interest rates as high as 10% for cryptocurrency deposits. Staking and lending crypto offers relatively steady monthly income, but risks include network downtime and smart contract hacks. But these things are not under government regulation, so the government will not help you while facing loss or fraud. It is better to transact with a known person and ensure investors have in-depth knowledge. Otherwise, getting a huge loss is a must part.
NFT Royalties: it has been brewing in all the zen-g cultures as it can help them with high returns and earn another source of income. But in NFT, investors must be aligned with the market trend and what has been happening to benefit from it. As an NFT creator, you can set up long-term royalty arrangements to receive a percentage of secondary sales of your NFTs – potentially for years. Most NFT marketplaces allow you to specify a royalty rate of up to 10%, which is collected and paid out each time you sell NFT. While NFT income can be unpredictable, success stories of popular NFT projects generating huge royalties exist. There are a lot of MNCs companies, such as T-services. Tech Mahindra, 1Viacom18, and many others have published their own NFT, showing that digitalization has changed the way of investing.
With royalties, people can create their own NFT and sell in a different medium like Binance NFT or Wazir NFT. Still, in it, the creator has to have the skills of graphics and automation like the investor should love in the first watch because many people are creating it, and the competition is in it high.
Writing Covered Calls: Like stocks, you can write call options against your crypto holdings to generate premium income. This strategy works best with stablecoins and cryptocurrencies with lower volatility. The premiums from call options are collected upfront, but one can write it off every month. The downside is capping upside gains if the underlying crypto spikes dramatically.
Crypto Lending Pools: Some decentralized finance (DeFi) protocols allow you to lend your cryptocurrency for rewards in their native tokens. These protocols offer competitive interest rates, but smart contract risk remains a concern. However, if the crypto rewards appreciate significantly, monthly returns can be amplified.
Mining/Staking Pools: By participating in crypto mining and staking pools, you can earn a share of the block rewards paid for verifying network transactions. Income depends on the amount staked, pool fees, and network performance. While computational power is essential for mining, staking merely requires holding the crypto to earn rewards.
Option Premium Selling: Instead of just covered calls, selling put and call options against stocks, ETFs, and cryptocurrencies can generate monthly premium income. However, option selling strategies present risks like taking assignment of the underlying asset and increased margin requirements. Premiums must exceed commissions to realize profits.
Cryptocurrency, NFTs, and options have the potential to generate meaningful monthly income for investors willing to take on higher risks. These alternative assets still carry considerable volatility and uncertainty, so proper risk assessment and portfolio diversification are essential. For those who participate, success will likely hinge on a combination of sound strategies, research proficiency, patience, and luck. Over time, as these new markets mature and regulation provides more clarity and safeguards, the income generation capabilities of crypto, NFTs, and options are likely to improve.
For now, investors would be wise to temper expectations and start small with these alternative income sources. Gains from crypto staking, NFT royalties, and option premium selling should be viewed as complements to – rather than replacements for – traditional methods of monthly income generation through stocks, bonds, and savings. By building a diversified portfolio that spans both conventional and emerging assets, investors can benefit from the higher rewards of the latter while minimizing risks through diversification. Income needs should also dictate the proportion of alternative investments based on an individual’s risk tolerance, time horizons, and financial goals. As always, a balanced and disciplined approach rooted in fundamental analysis and risk management will be key to success over the long term.