Is It Possible to Earn Dividends from Cryptocurrency?

Investing in cryptocurrency is not all about day trading and crypto mining. You can also earn passive income from dividends. Here are the best cryptocurrencies to earn dividends.

Cryptocurrency has emerged as a new and decentralized form of currency that can transfer funds and other digital assets securely between two different individuals without a central authority. Unfortunately, many people don't know that there are many smart ways to earn money with cryptocurrency other than day trading.

Due to the open-source nature of cryptocurrency, many new coins brought new features to the industry, and some of them are still underrated. One of the features that worth checking out is the ability to receive dividend-like payments.

This article will provide you with a complete list of the best cryptocurrencies that pay dividends. But before we go into the list, we should know what crypto dividend is and how to earn it.

How to Earn Crypto Dividends

Initially, the term "dividend" refers to the distribution of a portion of a company's earnings, which the board of directors decided and paid to a group of its shareholders. Traditional dividends can be issued in cash payments, shares of stock, or other properties.

Crypto dividends also use the similar concept of profit-sharing but it comes from various cryptocurrency companies. Know that this is not the same as airdrops, which dilute total supply, resulting in dilution of everyone's holdings.

There are a few methods to earn dividends in the crypto world by holding a cryptocurrency – sometimes by simply holding the crypto passively and sometimes for taking specific actions. It's crucial to acknowledge that the requirements may vary from one currency to another because each coin has its own way of operating and has its own terms and conditions. As a result, payouts can vary, sometimes paid daily or monthly. Based on the trading volume of the exchange, the crypto dividend is a flexible passive income.

Firstly, you can earn dividends by staking your coins. This means you should hold Proof-of-Stake (PoS) coins in a particular wallet or a supported exchange. This method is often seen as an alternative to crypto mining.

Coin holders can "stake" their coins (basically lock the coins in an open wallet) for a chance to be randomly ed to make new blocks in the blockchain. In return, these coin holders can earn a reward based on several factors including the number of coins owned, how long they've been staked in the wallet, and the total value of the cryptocurrency in question. As many popular cryptos have migrated from a mining system to a PoS system, this practice is getting more common these days.

Other than that, you can also earn dividends by holding, which is buying and holding crypto in any wallet.

Best Crypto that Pay Dividends

Based on the different types explained above, we have made a list of the best cryptocurrencies that are worth holding both for their great potential and for earning passive income in the form of dividends:

1. Komodo (KMD)

Komodo is a popular cryptocurrency with various features and a better consensus mechanism. Some of those features are a unique blockchain, a coin that pays interest, a decentralized exchange, and an ICO platform. And these are just pieces of what they have to offer in the future.

Komodo's blockchain is a fork of ZCash, which is a fork of the Bitcoin protocol. Therefore, it's safe to say that Komodo is a direct descendant of the Bitcoin protocol. It does have the zk-snark tech that is the foundation of Zcash, but instead of using the regular PoW-model like Bitcoin, Komodo has created a new mechanism that they call Delayed Proof-of-Work (DPoW).

DPoW involves a tool that notarizes the blocks on the blockchain, ensuring total immutability and giving the transactions a second layer of security. Other than that, Komodo is also part of a broader decentralized economy system called SuperNET, a pioneer in developing atomic swap P2P decentralized exchange called BarterDex.

Keep in mind that in Komodo, you don't have to do pure staking where you need to let your wallet open all the time. Instead, you just have to keep your token in a wallet and move around it every year.

2. AscendEX (ASD/BTMX)

AscendEX, formerly known as Bitmax, is a Singapore-based cryptocurrency platform with a native coin called ASD (formerly BTMX). What's interesting is that it lets you earn a percentage of the exchange income. AscendEX shares 80% of its net transaction revenues with investors in its ASD token, one of the highest payout rates among comparable exchanges. By locking your ASD token, you become eligible to earn income in USDT.

Once you buy the token, you can use its locking feature from the exchange to lock up your coin and you will be earning income in USDT. To do this, you have to purchase the coin, head over to the "assets" page, and click on "request for lock up". In this exchange, the reward is calculated and distributed daily.

3. KuCoin Shares (KCS)

KuCoin Shares (KCS) is the native crypto of KuCoin, a global blockchain asset exchange that was founded in mid-2017. The company has grown a lot and has been getting more recognition especially in 2018 because of its business model and marketing push.

If you hold KSC coins, you're going to get various advantages and discount on trading fees. By keeping the coin you can also earn rewards called KuCoin Bonus, which you can get daily. The bonus is 50% of the trading fees.

As trading fee revenues depend on fluctuating trading volumes, the bonus of holding the coin will increase if the volume and amount of coins traded in the exchange increases. Keep in mind that it also means that the number of dividends may vary each month.

4. NEO (NEO)

NEO, formerly known as AntShares, is a popular cryptocurrency that is often dubbed as the "Chinese Ethereum". NEO is one of the cryptocurrencies that exist on NEO's blockchain, other than GAS (formerly known as Antcoins). You can stake NEO in a NEO wallet for a good return and earn up to 5.5% annually. Yet, payments are received in the form of NEO's second token, NEOGas.

Unlike other PoS coins, NEO doesn't require you to keep your staking wallet open at all times to receive dividends. However, it's worth mentioning that not all wallets let you claim the GAS, so be sure to research the compatible wallets first if you plan to earn dividends by staking NEO coins.

5. Neblio (NEBL)

Compared to other cryptos listed here, Neblio comes from a newer platform. The company was established in 2017 as a blockchain platform for developing D-Apps, smart contracts, and launching ICOs. Lately, Neblio has been getting more recognition because of its development roadmap and standard examples of executing them.

When it comes to crypto dividends, NEBL holders can receive up to 10% dividend per year by staking their coins based on the company's PoS protocol. The coin can be staked in Neblio's official wallet as well as on a raspberry pi.

6. PIVX

PIVX stands for Private Instant Verified Transaction. It is an open-source, decentralized cryptocurrency that focuses on privacy, security, anonymity, and instant transactions. It was launched in 2016 as a code fork of Dash that aims to provide anonymous financial transactions by using its "sub-currency", zPIV.

The crypto is a PoS currency with a staking model that pays decently for PIVX holders who stake and hold the coins in their wallets. PIVX holders can get approximately 8% dividend per year for staking the coins. Conveniently, there is no cap for staking. However, the wallets must be open and online for a certain period to claim the staking rewards.

7. NAVCoin (NAV)

NAVCoin (NAV) was first launched in 2014 as the first cryptocurrency with a dual blockchain for private transactions. Such system allows NAVCoin users to make anonymous financial transactions on the NavTech subchain, offering better privacy to digital transactions. The coin is based on Bitcoin's core code, but it uses PoS system. NAVCoin holders can earn up to 5% dividend per year for staking their coins. There is no cap in staking.

8. ReddCoin (RDD)

Reddcoin was launched in 2014, aiming to become the digital currency of social media. To achieve the goal, ReddCoin allows Reddit and Twitter users to give tips to content creators in digital currency that they like. In addition, with its PoS consensus algorithm, ReddCoin holders are allowed to stake their coins to receive around 5% interest per annum.

9. Decred (DCR)

Decred is an autonomous cryptocurrency that was first released in 2016. It uses a hybrid consensus mechanism that is composed of both PoW and PoS systems to secure the network. Therefore, Decred holders can stake their coins and get around 30% dividend per annum.

10. VeChain (VET)

VeChain is known as a platform that offers smart contracts, similar to NEO and Ethereum. However, what makes it unique is that VeChain pays dividends in the form of VTHRO coins. The payout rate is around 0.00042 VTHOR tokens per day per staking 1 VET. VeChain holders can claim dividends either on a monthly basis or every second. The annual dividend rate per 1 VET is 15.33% in VTHOR tokens.

Final Words

Staking and holding cryptocurrency are great ways to get some of the cheap coins and earn passive income from regular dividends. Each year, blockchain technology and cryptocurrency continue to grow and increase in prevalence and use, so the dividends will also gradually increase.

Thousands of cryptocurrencies are currently available on the market, so it can be really challenging to examine every single one. However, you can count on the 10 cryptocurrencies provided above if you plan to stake and hold your coins to earn dividends.

Before investing in those coins, make sure to learn how dividends work in each coin and see if it's really worth it for you. Last but not least, remember that each coin is unique and has its own rules and regulations, so make sure to pick the one that suits you the most.