Finance | What is Passive Income?

Passive income is a financial term that refers to earning money without actively working for it. Passive income can come from various sources such as crypto staking returns, simple interest, compound interest returns, dividends and financial investments. In the crypto ecosystem, some popular methods for earning passive income are:

  • Investing in liquidity pools through DeFi platforms to earn interest returns,
  • Investing in assets that use a PoS (Proof-of-Stake) algorithm, thus investors could become a validators and earn passive income,
  • Earning passive income by staking tokens that provide dividend yield.