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Three Ways To Earn Passive Income To Beat Inflation

2021-10-16

Main Takeaways: 

  • Due to inflation, your purchasing power and money will steadily decrease in value every day you don’t earn interest.

  • Generating passive income is one way to prevent inflation from eating into your funds.

  • According to the U.S. Bureau of Labor Statistics, the Consumer Price Index rose 5.3% over the year ending in August 2021, making it harder to beat inflation. 

  • By placing your crypto into Binance Earn Savings products, you immediately gain a new income source with the click of a button.

With inflation rates rising and interest rates on the decline, just holding your cash and crypto is a sure way to decrease their actual worth. While not everyone has the time to invest their funds actively, there are still ways to make your money earn inflation-busting passive income. Binance Earn has a variety of products that can help you earn money while you sleep, providing year-on-year gains with a hands-off approach.

If there’s one thing that’s certain, no one likes to find out their savings are decreasing. But what exactly does this mean? Well, even if your dollars, euros, or Bitcoin balance stays the same, the real spending power you have is always going down. That’s right—we’re talking about inflation. Whether the economy is in good shape or not, inflation is something that we all have to live with. 

In fact, a small amount of controlled inflation can be good. But at the end of the day, we all want our savings to increase and not decrease in value. Unfortunately, the days of high-interest savings accounts are gone, but alternatives do exist that can provide you with enough interest to make a bank manager blush.

Rising Inflation Leaves Savers with Less Real Income

Around the globe, headlines for savers are looking bleak. With the U.S Bureau of Labour Statistics reporting that the Consumer Price Index “rose 5.3% over the year ending August 2021”, it’s difficult not to feel the pinch. Put simply, with prices for everyday items increasing sharply over the past year, if your crypto or cash hasn’t also increased by 5.3%, you’re losing money. While banks used to offer high interest rates, they’ve now been slashed to try and boost spending in a post-COVID world. In fact, the European Central Bank has even set a negative interest rate, meaning that account holders across the Eurozone are paying their banks to hold their money.

To many, crypto has offered a way to outpace inflation and enter a world free from central banks printing money out of thin air. And while crypto has seen massive gains, even if you’d purchased Bitcoin (BTC) at the start of May, you’d currently have made no profits. When we factor that in with inflation, even your crypto is losing real-world purchasing power.

What Is Passive Income?

If you’re looking for a low-effort solution to keep inflation at bay, passive income is your new friend. Simply put, it’s money you earn that doesn’t require active work. For example, stocks that pay out dividends are one form of passive income. You might also sell advertising space on your website or perhaps rent out a spare room. The initial level of work varies with all these scenarios, but the results are the same: a stream of income that doesn’t require you to be there.

If you’ve already got some crypto, earning passive income is safe and straightforward to do. In fact, you could even do it in the time it takes to read this post. If you don’t hold crypto, then the first step to beating inflation is getting hold of some. Take a look at our Binance Beginner's Guide for the quickest way to get started before jumping into the strategies below.

Three Ways to Start Earning Crypto Passive Income

No matter your experience level or crypto knowledge, you can still start generating interest with just a few clicks. Let’s take a look at three of the best ways to a passive crypto income, ranging from low to high returns:

1. Use Flexible Savings and withdraw your funds anytime, with no penalty or lock-up periods

If you’re HODLing coins that are just sitting in your account, it’s time to put them to use. By lending them to traders for a guaranteed interest, you can earn passive income for as long you’d like. And the best part? You can withdraw your funds at any time. 

There’s also no need to worry about losing your funds, as all borrowers have to cover their losses. By using a product like Flexible Savings, you can start to earn up to 5% annually, depending on the coin you provide. Binance also does everything for you automatically, leaving you free to sit back and earn.

2. Get higher interest rates with Locked Savings when you agree to a fixed-duration lockup period

If you like the sound of our first option but you’re looking for even higher returns, and don’t need urgent access to your funds, try Locked Savings. By lending your crypto for a certain period, you can earn up to a huge 45% annual interest. Locked Savings works the same way as Flexible Savings but rewards lenders even more for simply locking in their crypto for a fixed period. It’s the ultimate set-and-forget tool to beat back inflation and even come out earning at the end.

3. Earn staking rewards and high interest rates when you agree to a fixed-duration lockup period

Have no fear, you don’t need to be a tech wizard to earn interest and support your favorite blockchains. Getting involved is no different from our savings options above. By staking certain coins for a fixed period, you can help improve the security of a network and even earn up to 152% annual interest. Locked Staking is a great option for users who want to be more involved in the blockchain community and grow their crypto balance in return.

How to Get Started with Binance Earn

If you want to put your cash and crypto to work, Binance Earn is one of the simplest ways to do so. As we already explored, there’s a variety of set-and-forget products to choose from that are low-risk too. But first of all, if you haven’t already created a Binance account, you’ll need to register and complete the Identity Verification process. Once you’ve logged in, head to Binance Earn to see a full listing of all the options on offer to start earning passive income today.

For more detailed information on how to use Binance Earn, as well as the terms, conditions, and risks, refer to the following FAQs and guides: