Welcome to my blog where I, Nari Shari, will teach you how to make money online. Making money online does not have to be hard, and anyone can do it. All it takes is dedication. You do not need a lot of time or a lot of money to be able to make money online. A couple of hours a week is enough for you to be able to earn money. With that said. The more time you spend, the more money you can earn.
Earning extra money online by working nights and weekends can have a tremendous impact on your life. Especially if you dedicated all the money you make towards one specific goal. You can quickly meet your goals if all the extra money you earn goes to one goal. I know of people who have worked extra from home to be able to pay off their mortgage and students loans in less than 5 years. You will, however, need to dedicate several hours a day to be able to achieve results like that. A little luck doesn’t hurt either.
Not everybody that tries to work extra from home will be able to pay down their mortgage in a few years but everyone that is willing to spend at least 1 hour a day can earn enough to go on a nice vacation every year or to be able to buy a new car every few years.
The only thing limiting how much you can earn online will be you and the effort you put into it.
Work hard, do not gamble
It is import to work hard if you want to make money. There are no short cuts. You often see advertisements for different get rich quick schemes. Schemes that promise to teach you how to make easy money by trading binary options, by using secret techniques that guarantee profits while betting.
All these schemes promise to make you money, promise you that you can not lose and all off them are scams. None of them work. If anything seems too good to be true than it is too good to be true. There is no system that can beat the roulette wheel. No foolproof strategy to trade binary options. Do not get me wrong. It is possible to make money trading binary options but most traders who tries will fail and end up losing money, You can learn more by visiting BinaryOptions.net. An honest website even though the staff has a more positive view of binary options than I do.
If you want money for nothing, then you should stop reading here. This site is only for those who are willing to work for their money. To work hard to build a better future.
You do not need any money to make money
You do not need any money at all to be able to start making money online. It is good if you can devote USD 50 to get started but it is not necessary. The USD 50 will only speed up your progress. You can start without spending a single cent and earn the USD 50 mentioned in a few days or a couple of weeks max.
It is important that you understand that you will earn very little money when you get started and it can be hard to stay motivated during the first few months but if you stay motivate you will soon find that your income starts to go up and that your hourly wage goes up and up.
There are some methods that you can use to earn more money from day one but they do not scale over time in the same way as some other methods. It can be good to use methods to earn short terms profits as well as methods developed for more long term gains.
Use your money to make more money
There are plenty of methods to make money online that requires you to already have some money to put to work. These methods allow you to earn a lot of money quickly. You can use these methods to invest the money you earned working online to make sure that you earn even more money.
An easy way to earn money using the money you already earned is to invest the money in blue chip dividend stock. You can read more about this and the risk associated with investing in stock here.
Another way to make money that requires more effort is to use the money you earn to day trade and make money from daily fluctuations in the value of different financial instruments. Day trading does not require a lot of money. You can use leveraged financial instruments to be able to make a lot of money without having to invest a lot of money. This will expose you to a lot more risk than what you would expose yourself to if you day trade without leverage. You can learn more about day trading and the risks associated with day trading here.
Different Types of Trading and How They Fit Real-World Strategies
There are many different ways to make a profit from financial market trading, and the approaches traders take varies widely. Some will for instance do intense day trading sessions, while others go for swing-trading and take positions based on trends that stretch out for weeks. The differences between different strategies and approaches comes down to factors such as time horizon, time sensitivity, frequency, and risk.
Understanding the main types of trading is useful whether you’re already actively involved in the markets or a beginner looking to find a style that fits your schedule, temperament, and risk-willingness. Below, we will take a look at day trading (including scalping), swing trading, position trading, and news trading. We will also pay some attention to algorithmic trading (algo trading), since this is now and accessible trading approach even for retail traders.
There’s no single “best” trading style. Each type demands a different mindset, time commitment, and type of emotional control. The most important thing is choosing a style that fits your personality, your schedule, you analytical style, and your ability to manage your emotions. Some people thrive on the speed and intensity of day trading. Others prefer the measured approach of swing or position trading. Some are more analytical and want to build systems and program trading robots, while others trust their ability to read charts and make quick decisions in the heat of the moment.
The most profitable traders are usually not the ones who try to master every style and jump on every opportunity. Instead, becoming long-term profitable is easier if you strive to become good at one —and stick to it long enough to learn its rhythms and pitfalls, and build yourself an edge.
Day Trading
Day trading is all about short-term moves. Positions are opened and closed within the same trading day. Nothing is held overnight. The idea is to capture intraday price fluctuations, usually by watching technical indicators, volume spikes, or breaking news that cause immediate movements. You can learn everything you need to know to start day trading by visiting the website DayTrading.
Because of the speed and intensity involved, day trading requires quick decision-making, strict risk control, and a strong focus during the trading session. It’s typically not something you do casually between meetings or while tending to a baby. The upside is that once you have closed all positions, they are closed – and you can focus on other things in your life. You do not have to live with your phone glued to your hand, constantly ready to check on open positions as you go about your day.
While the potential for profit is big, so is the potential for losses, especially when trades are based on impulse rather than structure. Most long-term successful day traders operate with a plan that dictates exactly when to enter and exit trades, how much to risk, and what setups to look for. It’s a style that rewards discipline, not emotion.
Day trading is suitable for traders who enjoy fast-paced environments, thrive under pressure, and can stick to a playbook instead of being swept away by emotions in the heat of the moment.
Scalping
Scalping is an especially intense and short-term form of trading. Positions are held for seconds to minutes, and the goal is to take advantage of tiny price fluctuations that will be present even in seemingly stagnant conditions.
Scalpers enter and exit quickly, often executing dozens—or even hundreds—of trades in a single day. Because profits per trade are small, scalping usually requires tight spreads, high leverage, and low transaction costs. It’s most commonly done in forex, futures, and highly liquid stocks. Institutional traders and algorithmic platforms dominate this space, but some experienced individuals still find success here.
Scalping demands near perfect execution and a deep understanding of price action. There’s little room for error. Most people who try scalping without the proper trading platform, market access, fast internet connection, software tools, strategy, or temperament end up frustrated and overtrading. It’s a niche style, suited only to those who can operate with razor-sharp focus and aren’t deterred by rapid-fire decision-making.
Swing Trading
Swing trading sits in the middle between fast-paced day trading and longer-term position trading. Positions are typically held for a few days to a few weeks, or months, depending on the strength and development of a price move. The goal is to catch “swings” in the market—moves driven by technical patterns, market sentiment, or short-term catalysts like earnings, economic data, or news events. Many swing traders combine technical analysis and fundamental analysis.
Unlike day trading, swing trading doesn’t require intense trading session and you do not have to sell at exactly the right minute. Many traders in this category analyze charts after market hours and set alerts or stop orders in advance. It’s a more flexible approach, ideal for those who want to trade actively but aren’t looking to make it a full-time job.
Success in swing trading often comes down to timing entries and exits around levels of support and resistance, understanding momentum, and managing risk during periods of consolidation. While it may look slower from the outside, it still demands consistency and a clear plan, and it is definitely not an effortless way of making money.
This style fits those who want a structured but not hectic approach to trading—enough activity to stay engaged, but without the intensity of day trading.
Learn more by visiting SwingTrading.com.
Position Trading
Position trading is generally more long-term than swing trading, but there is an overlap when it comes to the time-horizon, because (depending on the circumstances), position traders sometimes close their positions within a few weeks or months, just like swing-traders. With that said, they are also ready to keep positions open for over a year when necessary, which is rare among swing traders.
For a position trader, the focus is on longer trends—longer-term momentum driven by economic cycles, sector rotation, or macro fundamentals.Position traders may enter based on technical levels, but they usually support their trades with bigger-picture ideas: interest rate trends, inflation data, central bank policy, or company fundamentals. It’s not passive investing, but it’s definitely not chasing candles either.
This approach works best for traders with patience and a strong understanding of market context. The advantage is that it avoids the noise of day-to-day fluctuations. The downside is that it requires holding through pullbacks without panicking and you must be able to handle watching prices rise and fall within a longer-term trend.
Position trading is often used by traders with full-time jobs or businesses, who want exposure to the market but don’t want to be glued to a chart. It suits those who prefer clear direction over constant adjustment.
Event-Based Trading
Some traders focus less on charts and more on catalysts. Event-based trading revolves around reacting to—or positioning ahead of—market-moving events. That might for instance be central bank decision announcements, economic data releases, company earnings reports, or geopolitical news.
The edge here is speed and context. Event-driven traders need to know what matters, when it’s happening, and how the market is likely to react. This type of trading requires a good sense of timing. It’s especially common in forex and equity markets, where economic reports and earnings can cause sharp, fast moves.
Event-based trading is suitable for to those who are willing to stay on top of the news and are quick on execution. It’s not about being first—it’s about being right when it counts.
Algorithmic Trading
Algorithmic trading (algo trading) is driven by pre-programmed software that will execute trades based on your predefined rules. The strategy you elect to use can for instance be based on technical indicators, statistical models, mean reversion, trend following, or even news-based sentiment analysis.
Algorithmic traders often use backtested data to refine their strategies before going live. Some systems are fully automated, while others are semi-manual, requiring human confirmation before executing trades. A system needs to be fully automated to react really quickly when opportunities matching the pre-defined criteria are detected, but you will give up autonomy to do this. A requirement for manual confirmation keep you in the driver´s seat, but you will sacrifice valuable seconds or minutes, and you will also miss trades when you are not available to notice the alerts.
Using a so called trading robot (the algorithmic trading software) can help prevent emotional trading in the heat of the moment, since you can program it in advance and then step back, letting it open and close trades automatically. If you elect to use manual confirmation, you put some of that emotional risk back in the game, since your emotions can impact your decision to confirm or deny a request from the program.
Algo trading is systematic, structured, and ideal for those with a background in data analysis, programming, or engineering. The barrier to entry is higher, but the reward is consistency—if the strategy is solid.
Financial Instruments You Can Trade
Once you understand the mechanics of trading—entries, exits, risk, timing—the next question becomes: what exactly are you trading? Because not all financial instruments behave the same. Some are simple, some are layered with leverage and contracts. Each has its own rhythm, risk profile, and role in the market.
Knowing the main types of tradable instruments can help you as you figure out where you belong as a trader. It is important to avoid jumping into something you don’t understand well enough—because what works in stocks won’t necessarily work in forex, what works in hard commodities may not translate into bonds or cryptocurrency, and so on.
Whether you’re trading actively or investing longer term, choosing the right instrument matters immensely.
Equities
When most people think of trading, they think of stocks. Buying shares in a company gives you a small ownership stake and exposure to its performance. If the company grows, so might its share price. If it disappoints or crashes, you take the hit.
Traders typically go for publicly traded stocks (stocks listed on a stock exchange), but over-the-counter (OTC) trading. Equities can be traded in dozens of styles—short-term, medium-term, or long-term, using technical analysis or fundamental analysis or a combination of both. Volume, volatility, and liquidity are generally strong for large-cap stocks.
Stock prices can be impacted by a variety of factors, such as earnings reports, analyst ratings, sector trends, and broader economic data. While it’s one of the more accessible instruments to trade, it still requires a clear understanding of risk and market cycles.
Some traders who want to gain exposure to the stock market use equity derivatives, such as stock options and stock CFDs, which introduce more complexity.
Exposure to a group of stocks is also possible through exchange-traded funds (ETFs) that invest in stocks.
Forex
The forex market (the foreign exchange market) is where we buy and sell currencies. Unlike stocks, you’re not buying a part of a company—you’re buying one currency and pay for it using another currency.
The forex market is based on currency pair, such as USD/EUR, GBP/JPY, and AUD/CAD. You’re essentially betting on whether one will rise or fall relative to the other.
The forex market is the most liquid financial market in the world and runs 24 hours a day, five days a week. Because forex allows for high leverage and tight spreads, it attracts a lot of short-term traders—especially those using scalping or day trading strategies. Even when currencies do not move dramatically in price, the use of high leverage mean that even small shifts lead to significant gains—or losses.
Currency exchange rates are moved by factors interest rates, inflation expectations, central bank decisions, and geopolitical events. Technical analysis plays a massive role, as do news releases like non-farm payrolls (USA), CPI data (USA), and the announcements of central bank interest rates.
Commodities
Examples of commodities traded on the world market are crude oil, natural gas, gold, aluminum, cocoa, sugar, and wheat.
Unlike stocks, commodities are physical goods. Factors such as weather, war, production capacity, harvest statistics and projections, consumption trends, and government policy can impact the price.
Fortunately, you don’t have to hold or ship barrels of oil or blocks of gold to gain exposure to the price. Most commodity trading is done through derivative, such as futures contracts. A commodity futures contract is an agreements to buy or sell a specific amount of a commodity at a set price on a future date. These contracts can be traded just like other financial instruments, offering opportunities for speculation and hedging.
Commodity markets can be volatile, especially around geopolitical events or unexpected supply disruptions. They often follow macroeconomic trends and are also influenced by the value of the U.S. dollar, inflation data, and global growth expectations.
Trading commodities requires a commodity mindset, and you may for instance find researching OPEC meetings, drought forecasts, and global shipping routes.
Bonds
Bonds are debt instruments issued by governments, corporations, or municipalities. When you buy a bond, you’re essentially lending money to the issuer in exchange for regular interest payments and the return of the principal (the lent amount) at maturity (the date on which the bond reaches the end of its lifetime).
Government bonds are also known as sovereign bonds. Examples of well-known government bonds:
- Treasury Bill (T-Bill). This is a short-term debt obligation backed by the U.S. Treasury Department. The maturity is of 1 years or less.
- Treasury Note (T-Note). This is a debt obligation backed by the U.S. Treasury Department. The maturity is between 1 year and 10 year.
- Treasury Bond (T-Bond). This is a debt security issued by the U.S. Federal government and the maturity is 20+ years.
The bond market is often seen as more conservative, but it’s no less dynamic—especially when interest rates are in play. Bond prices tend to move inversely to central bank interest rates. If central bank rates rise, bond prices fall, and vice versa. This relationship drives a lot of trading in sovereign debt markets, particularly among institutional investors. Traders in this space look at yield curves, inflation forecasts, and central bank policy to position ahead of rate changes.
When the general interest rate level in an economy is high, investors can find better use for their money than investing in low-yielding bonds. If the general interest rates go down, bonds start to look more appealing – especially if the economic situation is also a bit stormy and investors want to bring down the overall risk profile of their portfolio.
For retail traders, getting access to direct bond trading can be tricky, but exposure to bond prices is readily available through derivatives, such as bond CFDs. You can also buy and sell shares in ETFs that invest in bonds.
While not as fast-moving as equities or forex, bonds offer insight into market sentiment and risk appetite—and they can play a strategic role in balanced portfolios. The creditworthiness of the issuer will determine how high an interest rate they must give to attract bond buyers (lenders). A stable country with a very high credit rating can issue bonds with low interest rate and still have plenty of investors flock to buy them; including conservative institutional investors. A less creditworthy country must offer a higher interest rate, and sometimes also shorter lifespans, to attract lenders. The same is true for corporations.
The Primary Bond Market and the Secondary Bond Market
The primary bond market is where you find bonds when they are issued by the issuer (primary distribution). On this market, buyers will purchase new bonds directly from the issuer, e.g. from a government.
Eventually, many bonds make their way to the secondary market, as buyers who bought them during the primary distribution want to sell them to someone else. Typically, secondary market participants will use a broker to connect them.
Corporate Bonds
Corporate bonds are issued by corporations, often to raise money for some new project, such as establishing new factories or entering a new geographical market. Generally speaking, corporate bonds tend to have a lifespan of at least one year.
Muni Bonds
Muni bond is short for municipal bond. They are especially common in the United States, where they are issued by states, cities, special-purpose districts, publicly owned airports and seaports, public utility districts, school districts, and other government-owned entities that need to borrow money. In the United States, muni bonds are usually tax-free at the federal level, and they can also be tax-exempt at the state or local level.
What is an Investment Grade Corporate Bond?
An investment grade corporate bond is a bond where the issuing corporation has been rated by a bond-rating firm such as Fitch, Standard & Poor’s or Moody’s and found to have a sufficiently high creditworthiness for the bond to be ranked as high-quality and low risk.
In the opposite end of the spectrum, we find junk bonds – bonds where the issuer has a very poor credit rating. Junk bonds are appealing to investors who are willing to take a higher risk in exchange for higher interest rate payments.
How Old is the Bond Market?
The basic idea of transferring an obligation from one person to another is probably as old as humanity itself, but for how long have there been a functional bond market available for traders? The oldest known instance of assignable or transferable debts dates back to ancient Mesopotamia, where debts denominated in units of grain weight were exchanged. A more modern type of bond was created by the Bank of England, when it needed to raise funds for the British navy in the 1600s. The first bonds issued by the United States Treasury was also about war; they were created to bring in funds for the U.S. military during the war of independence. If we look at corporations rather than governments, we do for instance find 17th century bonds (guarantees / sureties) issued by the Dutch East India Company (VOC), and the famous 18th century Compagnie du Mississippi actually issued bonds before issuing any stocks.
Indices
Indices track baskets of assets, e.g. a basket of stocks, commodities, or currencies. By speculating on an index, you can gain exposure to the market value of that basket in one quick move. You can gain exposure to an index through a variety of derivatives, including index futures, index CFDs, and index ETFs.
Stock index
A stock index is a convenient way to gain exposure to a certain segment of the stock market, e.g. a certain industry, sector, or geographical market. The S&P 500 index tracks large-cap U.S. companies. The FTSE 100 index represents 100 large-cap companies traded on the London Stock Exchange. The DAX covers German blue chips. Instead of picking individual stock companies, trading indices lets you bet on overall market direction.
Stock index trading is popular for those who want exposure to broader trends. You’re not worrying about individual earnings reports—you’re watching macro indicators, monetary policy, and investor sentiment. Many traders like stock indices because they’re less volatile than single stocks, but still offer solid movement for swing or day trading. Others use them for long-term positions tied to economic cycles.
Bond index
A bond index tracks the performance of a bond portfolio. One of the most famous of these indices is the Bloomberg U.S. Aggregate Bond Index – commonly referred to as Agg – which tracks a portfolio of government and corporate bonds and investment-grade debt instruments with issues higher than 300 million USD and where the maturities are at least one year. Many investors use the Agg as a benchmark when evaluating present and potential investments.
Other notable examples of bond indices are the Merrill Lynch Domestic Master, the Salomon Broad Investment Grade Index, and the Citigroup U.S. Broad Investment-Grade Bond Index. The Merrill Lynch Domestic Master tracks US dollar denominated investment grade Public Corporate and Government debt, including treasuries, mortgage-backed securities, global bonds (debt issued simultaneously in the eurobond and US domestic bond markets), and some Yankee bonds (debt of foreign issuers issued in the US domestic market) with a fixed coupon schedule and at least 1 year remaining term to maturity. US Treasuries are excluded when they have less than 1 billion USD outstanding and all other securities are excluded when they have less than 150 million USD outstanding.
Derivatives
Above, we have mentioned derivatives several times. But what is a derivative? In the world of finance, a derivative is a financial instrument whose market value depend on the market value of an underlying asset or financial product, e.g. a stock, a commodity, or an index.
One of the most well-known derivatives is the option, which gives its holder a right —but not any obligation—to buy (call option) or sell (put option) an underlying asset at a specific price before a set date. Options are used to speculate, hedge, or generate income depending on the strategy. The market price of an option involves more than just price direction of the underlying asset —it’s about time decay, implied volatility, and strike price relationships. Exchange-traded options are cash settled, meaning you do not actually get the right to become the owner of any shares (or other underlying assets). Instead, the option is cash settled.
Derivatives can be used to build complex multi-leg strategies, but they also come with special risks—e.g. if you’re trading naked calls or puts with leverage. Still, for experienced traders, derivatives can open up more creative and tactical ways to manage trades.
Exchange Traded Funds (ETF)
Exchange-traded funds (ETFs) are funds where the shares are listed on an exchange and traded throughout the trading day. For a classic mutual fund, shares are normally only bought and sold once a day. With an ETF, you can buy and sell shares throughout the trading day, in manner very similar to trading public stocks.
An ETF makes it easy to get diversification from day one even if you only have a small amount of money to risk. You can for instance pick an ETF that invests in 500 different stock companies across different industries and sectors, to ensure you get that level of diversification from the get go.
Cryptocurrencies
Below you can see the market value of some of the most popular cryptocurrencies. Below that you can read more about why I do not recommend that you invest in cryptocurrencies.
I personally do not recommend that anyone invest in cryptocurrency or start day trading crypto . There is a lot of people who have made a lot of money investing in crypto but I do personally believe that the downside is too large. At this point I consider it to be gambling to invest in cryptocurrency. I believe that the popularity of Bitcoin and other cryptocurrencies have already peaked. It can not be denied that anyone who bought Bitcoin a few years ago has earned a lot of money. But you can not expect to earn anywhere near that much if you invest today and the risk of losing money is very large. You can read more about why I think cryptocurrencies have peaked by visiting this page.
Different Types of Cryptocurrencies
Not all cryptocurrencies are created equal. Some were built as an alternative to national currency, while others have more functionality and were designed to fuel networks, build apps, or represent ownership in a project. Once you look past the headlines, the cryptospace reveals a mix of tokens, coins, platforms, and ideas—some practical, some experimental, some with real-world traction, and some that became nothing more than a hot flash in the pan.
Understanding the different types of cryptocurrencies helps you make better decisions—whether you’re trading, investing, building, or just trying to make sense of what’s worth paying attention to and what’s probably noise. Below, we will take a look at a few labels that are commonly used within the cryptophere, such as coins, tokens, stablecoins, and memecoins. As you will see, it is not impossible for a cryptocurrency to belong to more than one category, so keep your eyes open.
Coins vs Tokens: Is There A Difference?
Sometimes, we get lazy and use the terms crypto coins and crypto tokens as synonyms. Before we process to discus cryptocurrencies more seriously, it is important to know that there is actually a difference between crypto coins and crypto tokens in this context.
Generally speaking, only a cryptocurrency that run on its own independent blockchain is called a coin. Examples of true coins are Bitcoin and Litecoin. They are standalone digital currencies designed primarily for peer-to-peer transactions or to store value.
A crypto token, on the other hand, is built on an already existing blockchain—such as the Ethereum blockchain. Tokens don’t have their own chain and are created using smart contracts. Tokens can represent all kinds of things: access to an app, governance rights in a project, stakes in a DAO, or value in a DeFi protocol.
So while all crypto coins are cryptocurrencies, not all cryptocurrencies are coins. Many are instead tokens—utility-based, governance-focused, asset-backed, or created for specific ecosystems.
Payment Coins
This is the original use case for cryptocurrency—fast, borderless, decentralized payments. Bitcoin is the flagship here. It was created as an alternative to traditional fiat money, designed to be scarce, secure, and not controlled by any government. Others followed, including Litecoin, Bitcoin Cash, and Dash—each trying to improve on Bitcoin’s limitations by speeding up transactions, lowering fees, or changing the underlying code to increase flexibility. While Bitcoin remains the most widely recognized and accepted payment coin, these alternatives still maintain active communities and merchant support in certain regions and subcultures.
The idea behind payment coins is simple: send value without middlemen. Whether or not they replace traditional currencies is still up for debate, but they’ve proven that digital value transfer is possible without banks.
Smart Contract Platforms
Ethereum´s groundbreaking blockchain was designed not just for currency, but for building applications. This changed everything. Smart contracts let developers write rules into code—automating how funds are transferred, services are accessed, or agreements are executed.
Ethereum is the most dominant smart contract platform, and it has spawned a whole ecosystem of tokens, dApps, and protocols. But it’s not alone. Competitors like Solana, Avalanche, Cardano, Polkadot, and Near have entered the scene—each promising faster speeds, lower fees, or more scalable frameworks.
The cryptocurrencies tied to these platforms—like ETH for Ethereum and SOL for Solana—are used to pay for transactions, run apps, or stake in the network. Think of them as fuel for an engine, not just money. Many of the investors that are investing in these are not just betting on a currency—they’re betting on the long-term adoption of the platform and the apps built on top of it.
Stablecoins
Stablecoins was created with the aim of bringing predictability to a space known for volatility. Pegged to a real-world asset—usually the U.S. dollar—a stablecoin aim to hold a constant exchange-rate.
Popular stablecoins like USDT (Tether), USDC (Circle), and DAI (MakerDAO) are used across the crypto economy. Traders use them to exit positions without leaving the blockchain. DeFi protocols use them as collateral. Merchants accept them for payments.
So, exactly how does the peg work? Typically, stablecoins are backed by other assets, such as fiat reserves (USDC), crypto assets (DAI), or even algorithms (like the failed TerraUSD). Some stablecoins are centralized and managed by companies. Others are decentralized and governed by smart contracts or DAOs. Over time, stablecoins have become a useful tool for operating seriously in the world of crypto—especially for DeFi, lending, and cross-border transactions.
So, are they really stable? Most governments around the world that have tried to keep their national currency pegged to another currency have found that it is not an easy task, and the same is true for the stablecoins. Even though they are marketed as stable, they are definitely not immune to risk, and there is no guarantee the peg will hold if the market loses faith in the cryptocurrency. Several stablecoin projects have also faced a lot of criticism for failing to prove that they actually hold the assets they claim to have.
Utility Tokens: Access and Functionality
Utility tokens are keys that unlock features inside a blockchain application or ecosystem. You don’t hold them as just any money. You hold them to use for something specific. One example is Chainlink (LINK), a token used to pay for real-world data feeds that power smart contracts. Or BAT (Basic Attention Token), which is used to reward users and advertisers inside the Brave browser. Or Filecoin (FIL), which incentives decentralized storage across the internet.
These tokens are built with a comparatively narrow purpose. They live inside specific platforms, and their value often depends on how much people actually use that platform. If adoption grows, demand for the token grows. If not, the token might just sit idle. Utility tokens are everywhere in the Web3 space—from NFT platforms to gaming, from prediction markets to cloud computing alternatives.
Governance Tokens
As decentralized protocols grew, a new question came up: who makes the decisions? In some cases, governance tokens were the answer. These tokens give holders the right to vote on changes, upgrades, fee structures, and roadmaps in decentralised systems. Projects like Uniswap (UNI), Aave (AAVE), and Compound (COMP) issue governance tokens to their communities. The idea is that users and stakeholders—not central teams—decide how the protocol evolves.
Holding a governance token doesn’t guarantee profit, but it gives influence. In some cases, votes control hundreds of millions in liquidity or fees. The more tokens you hold, the more voting power you have. Governance tokens can be an important part of what makes a protocol decentralized. They’re also a major part of DAO (Decentralized Autonomous Organization) structures, where every decision is made by token holders, not founders or investors.
Wrapped Tokens
Wrapped tokens allow cryptocurrencies from one blockchain to be used on another. The most common example is Wrapped Bitcoin (WBTC)—an Ethereum-based token that represents Bitcoin. This lets you use BTC in Ethereum’s DeFi ecosystem without actually moving Bitcoin across blockchains.
Wrapping solves a compatibility issue. It creates a version of the asset that works in another system, while still holding its value. These tokens are especially useful in DeFi, cross-chain swaps, and liquidity provision. Wrapped tokens have opened up a huge amount of functionality—letting users access lending, trading, and yield farming opportunities without being limited by chain compatibility.
Meme Coins
Then there’s the weirder side of crypto. Meme coins, like Dogecoin or Shiba Inu, started as jokes—but some ended up with massive communities and billions in market cap. They often rely on online communities, humor, and viral momentum more than any fundamental use case. Even by cryptocurrency standards, they tend to be volatile, unpredictable, and high risk—but for some traders, that’s exactly the appeal.
Experimental Assets
Governance forks, tokenized real-world assets, fractional NFTs, or algorithmic currencies are all examples of experimental assets. Some have real innovation behind them. Others are speculative gambles or outright scams.
This article was last updated on: May 12, 2025