How does Bitcoin make money?
Well, first off, Bitcoin is not a company, nor does Bitcoin itself make money. Bitcoin is a protocol, a set of standards that companies and users follow to use Bitcoin. Asking “how does Bitcoin make money” is akin to asking “how does the internet make money” – it’s the wrong question to ask, and there is no answer, because Bitcoin doesn’t make money.
Now that said, there are many ways people are making money in the world of Bitcoin. Here’s a few:
Many companies offer tools to make it easier for consumers and merchants to use Bitcoin, and are either ad-supported or charge fees to access premium features. Such services include Bitcoin wallets, invoicing, blockchain explorers and Bitcoin statistics.
Perhaps the most common way people are making money with Bitcoin is through retailing. Selling goods and services is easy using merchant tools from companies like Coinbase and Bitpay, and fees are either nonexistant or at least much less than the fees for accepting credit cards. If you have some skills or goods to sell, check out coinality and cryptothrift.
Investing in Bitcoin
While daytrading is largely criticized as a zero-sum game and no better than gambling, you may try your hand at it using one of several Bitcoin exchanges. Bitstamp and BTC-e have both been around for a couple of years, though the trustworthiness of these exchanges is questionable – do your own research!
Unless you happen to have a spare datacenter and access to incredibly cheap electricity, this probably isn’t a viable option for you, but that doesn’t take away from the fact that large-scale miners across the world are making millions on mining bitcoins. As I mentioned in my post, “Is Bitcoin mining worth it?“, mining isn’t something your average consumer can make money on anymore.