Cryptocurrency stepped into the financial stage in 2009 with the launch of the first-ever Cryptocurrency in the world, Bitcoin, and has become not only popular but also a significant, permanent part of our economy.
It has also revolutionised the financial economy in many ways. A few among these include:
- Cryptocurrency is not subject to any control, either from government or financial institutions, making it the very first currency to be resistant to manipulation or censorship. All these are due to its decentralised nature.
- Cryptocurrency doesn’t discriminate in its inclusiveness, meaning anyone with an internet connection can own or transact it from any part of the world. It is, therefore, no surprise that it is favoured especially by people in developing countries.
- For businesses and individuals that trade across borders, Cryptocurrency has made cross-border transactions more straightforward, accessible, and faster.
- This has made it possible for people to make financial transactions without processing them through the bank. You can receive and send money (in the form of Cryptocurrency) without using a bank, and you can trade on many cryptocurrency trading platforms to your local currency.
Cryptocurrency has also made it possible, through many opportunities, for people to save, invest, and make money from it.
Among the numerous opportunities for making money in Cryptocurrency, Crypto Staking is one of the most attractive and accessible ways, as it lets you earn passive income while validating the Cryptocurrency—two birds with one stone.
What is crypto staking? How does it work? What are the best cryptocurrency platforms you can stake, sure to give you the highest returns? All these and more will be answered in this article.
|Name of the platform||Fees||Cryptocurrencies available||Minimum trade size||Payout intervals||Lock-in Period|
|1) Binance/Binance US||No fees||150+||0.1%||Daily payouts||flexible, 12-days and 30-days.|
|2) Crypto.com||Varies||250+||0.5%||Varies||Flexible, one-month, or three months.|
|3) Nexo||0.5%||35+||NA||Daily payouts||Flexible, one month, three months, six months|
|4) Coinbase||25%||250+||0.1%||Varies||Depends on the token|
|5) OKX||0.06%||343||NA||Daily payouts||Flexible or 15, 30, 60, 90, 120 days|
|6) eToro||10%-25%||100+||$10||Monthly payments||No lock-in period|
|7) My Container||7,90€/month + 1%-2%||120+||NA||Daily payouts||None|
|8) Kraken pro||No fees||200+||NA||It can be bi-weekly.||Flexible withdrawals|
|9) Kucoin||0.1%||700+||NA||Daily payouts||No lock-in period|
|10) Café Défi||1%-3%||100+||NA||Daily payouts||No lock-in period|
Firstly introduced into Cryptocurrency in 2012, with the launch of Peercoin, Cryptocurrency staking took the crypto world by storm. It quickly became both popular and the favourite of many crypto users, and the reason is straightforward to see.
Cryptocurrency Staking is the act of locking up one’s Cryptocurrency as collateral to provide liquidity and support to the activities of a blockchain network. This act is appreciated and rewarded by “interest,” called rewards being paid to the staker regularly in Cryptocurrency. In other words, Cryptocurrency staking is locking up your cryptocurrencies to support the security and decentralisation of Blockchain networks in exchange for rewards in the form of additional Cryptocurrency. It is a fantastic way to make passive income on your cryptocurrency assets.
Cryptocurrency staking bears a very distant similarity to savings. Just like you deposit money in a high-yield savings account and receive interest on your money any time the bank lends it out, only this time, it’s Cryptocurrency, and you are staking, not saving; you can’t just redraw it until the duration of the staking is over. Rewards replace interest, and you get paid in Cryptocurrency as well. Finally, the tips can vary while interests are fixed.
Cryptocurrency staking is only made possible by proof of stake (PoS). Blockchain networks require software to verify their blocks. Blocks are data structures that record recent transactions yet to be validated by the network, which are created on average every 10 minutes. These blocks can be verified in two ways: proof of work for miners and proof of stake and delegated proof of work for validators.
As proof of stake is more energy-efficient and scalable, blockchain networks allow individuals or entities they call validators to validate the blocks. To check these validators and make sure they work in the good interest of the Cryptocurrency they are working on, these validators are required to have and stake a certain amount of that Cryptocurrency, but this is only true for some blockchain networks. While there is no guarantee you would become a validator after betting, all the stakes staked are directed under different validator nodes, and every gain or reward gotten is slipped to all the stakes.
There are different types of staking, and here is a list of a few:
- Pooled staking
- Delegated staking
- Liquid staking
- Flexible staking
- Custodial staking
- Non-custodial staking
- Cold staking
While cryptocurrency staking is a fantastic way to support a Blockchain network and, more importantly, earn passive income in return, it has more advantages and some disadvantages.
1) Since your Cryptocurrency has to be locked up to be staked, it is the safest it would ever be, as it is not likely to be hacked or stolen.
2) This is the most popular advantage for Cryptocurrency staking. As a result of staking your crypto, you earn rewards paid in Cryptocurrency without you doing anything. So you just stake and earn, making passive income in crypto. It only comes second because profit-making should only come after safeguarding your assets.
3) Cryptocurrency staking has more potential for higher rewards when compared to mining or trading. This, however, depends on the scale of stake and Cryptocurrency in question, as rewards vary.
4) Staking cryptocurrency requires no hardware, software, or technical expertise. You only need a wallet and Cryptocurrency, and you can stake crypto.
1) It is essential to know that while your staked crypto is locked up, there is still the risk that the platform being used to stake your crypto can be hacked or fail, thereby leading to the loss of your crypto assets.
2) Cryptocurrency staking doesn’t save you from the volatility of cryptocurrencies. Just because your crypto is locked doesn’t mean it retains the same value even if the market goes down. So you might end up making a loss, even with interest being made if the price of the Cryptocurrency staked goes very low.
3) There is a minimum amount of crypto that is required to be able to stake. In other words, you need to have that certain amount of crypto to bet, at least not directly. You would need to join a staking pool to be able to bet. This is a barrier for most people, as the minimum amount can be high sometimes, like Ethereum.
4) You don’t only lose your Cryptocurrency when it is hacked when staking. You can also lose your cryptocurrency assets through slashing. When a validator goes against the Blockchain rules, they lose some or all of the staked crypto as punishment. In this situation, every staker under that validator loses the crypto they risked.
5) Finally, as long as your crypto is locked, you cannot access or trade it, no matter what happens, leading to your loss of liquidity. While you would get rewards in Cryptocurrency, access to the staked crypto is lost till the duration of the staking is over.
The world’s largest cryptocurrency exchange, Binance, stands at the top. Founded in 2017, Binance has grown immensely and has great credibility, making it an excellent option for cryptocurrency staking. Offering crypto staking on 150 plus cryptocurrencies, it is one of the largest staking platforms in the world.
Binance offers many staking options. Two prominent ones are flexible and locked staking. In addition to all its great qualities, Binance is also the cheapest exchange as it charges only a maker-taker fee of 0.01%, so you get to keep the more significant part of your reward when you finally trade it in for cash.
|👍 BINANCE Pros||👎 BINANCE Cons|
|✅ It charges a meagre fee for buying and selling crypto||❌ It operates a different platform for the US market that has a limited number of cryptocurrency assets that it can stake on compared to the central platform.|
|✅ It provides both flexible and locked cryptocurrency staking options|
|✅ It also offers daily payouts of the staking rewards|
|Cryptocurrency||Interest rates||Deposit minimum|
|Bitcoin (BTC)||0.2%||0.01 – 1|
|Ethereum (ETH)||1%||0.001 – 100|
|Tether (USDT)||1.4%||0.001 – 100,000|
|BNB (BNB)||3.6%||0.001 – 1000|
|XRP (XRP)||0.26%||0.001 – 50|
One of the most flexible staking platforms on the list, Crypto.com was designed to appeal to all levels of experience and choices. This platform allows investors to stake over 200+ crypto assets, including unpopular tokens. This means that regardless of a trader’s investment goals or risk tolerance, there is an option for them to stake on.
Crypto.com allows users to pick between Flexible staking, one month of staking, and three months of staking. Staking of Crypto.com’s native token CRO is a way to earn high returns on the platform.
Crypto.com offers private membership to users, and private members are paid 2% more yield interest than regular investors.
|👍 CRYPTO Pros||👎 CRYPTO Cons|
|✅ Offers flexible staking options||❌ It favours private members above regular members.|
|✅ Offers a wide range of crypto assets to stake on, including unpopular tokens|
|✅ Has a mobile app|
One of the only platforms to have insurance to protect clients’ assets in case of a hack or critical loss, Nexo is number 3 on our list.
To get the best rates, specific criteria have to be fulfilled. Firstly, while you can set a flexible erm of the stack, the best rates only get activated after one month of staking. So to get the best you have to wait for one month at least. Secondly, while you can get paid in the Cryptocurrency staked, an additional 2% is given if received in NEXO – Nexo native,e token, and this can even reach up to 12% if the investors are on ‘Pt.’ in.’ Platinum refers to those with at least 10% of their portfolio on the platform in NEXO.
|👍 NEXO Pros||👎 NEXO Cons|
|✅ It has no maximum cryptocurrency staking limit.||❌ You have to stake your cryptocurrency assets for more than a month to get the best interest rates.|
|✅ It offers daily payouts||❌ It is not regulated in the US|
|✅ It has a mobile app for both iOS and Android devices|
|Bitcoin (BTC)||Up to 8%|
Coinbown is one of the best exchanges with the most straightforward, most accessible user interface. Offering over 119 cryptocurrency assets for staking, Coinbase was established in 2012 and has been a reputable and efficient platform for people to stake their Cryptocurrency. The procbettingstaking on Coinbase is very smooth and easy.
There are also a lot of materials to educate users on staking. Coinbase has also considered giant steps to provide top-notch staking services and security to its users. These measures include insurance for clients in case of a cyberattack. It, however, has its downs as it has a tough KYC required to sign up.
|👍 COINBASE Pros||👎 COINBASE Cons|
|✅ It has a very easy-to-use interface, very beginner-friendly.||❌ It has a very rigorous KYC sign-up|
|✅ It has insurance for investor's assets|
|✅ You can stake as low as $1|
OKX is one of the best Cryptocurrency platforms for staking Ethereum (ETH). OKX is known for its Ethereum 2.0 feature, where investors can invest with as little as 0.01 ETH.
This doesn’t mean it is exclusive to Ethereum, as users can stake multiple cryptocurrencies on OKX, including OKB, the platform’s native token. Staking is not only easy but also straightforward and user-friendly.
OKX was founded in 2017, and it also has educational materials that are accessible for users to access.
|👍 OKX Pros||👎 OKX Cons|
|✅ It offers a wide range of cryptocurrencies for staking.||❌ Its minimum prices for staking are high|
|✅ It has a very straightforward staking process and interface||❌ It has a very strict KYC sign-up|
|✅ It offers educational materials|
|✅ It has a mobile app for iOS and Android|
One of the most popular cryptocurrency trading platforms in the world, eToro is primarily a brokerage firm that supports crypto, along with numerous other financial markets.
eToro is, however, known for its unique approach towards cryptocurrency staking. On eToro, there are no criteria for entry, as it practices automatic staking. In other words, after a few days of holding either Ethereum, Cardano, or Tron, it is automatically considered as stacking, and you get staking rewards based on the level of the investor. Also, eToro currently only has stacking available for these three cryptocurrencies, although there are plans to include more cryptocurrencies.
It is essential to note that as staking on eToro is automatic, it has no lock-in periods, meaning you can access your assets anytime. With its low trading fee, eToro is easy and cost-efficient.
|👍 eTORO Pros||👎 eTORO Cons|
|✅ It offers a meagre trading fee, so you can keep more when trading.||❌ It currently only supports staking on 3 Cryptocurrencies, namely, Ethereum, Cardano, and Tron.|
|✅ Not only does it offer automatic staking, it has no lock-in periods|
|✅ It has a mobile app for iOS and Android|
One of the most comprehensive platforms on the list, My Container, is your all-in-one cryptocurrency platform. It offers staking for over 122 crypto assets, with one of the highest annual interest returns.
It is also straightforward to use and fund as it offers numerous ways to deposit. It is also known for its multiple additional rewards, e.g., cashback, airdrops, etc.
It also has no lock-in period, and payouts are daily, so it is as flexible as they come. My container is primarily known for its unique ‘cold staking,’ which allows for staking in which tokens are locked in a cold wallet off the internet.
|👍 MY CONTAINER Pros||👎 MY CONTAINER Cons|
|✅ It offers a wide range of options for cryptocurrency staking||❌ It has a minimum withdrawal limit for each cryptocurrency asset.|
|✅ It has no lock-in period|
|✅ It has a mobile app for iOS and Android|
|✅ It is straightforward to fund.|
Made with sophistication in mind, Krakenpro is the best choice for experienced traders due to its highly customisable interface. It also offers a lot of advanced trading tools. It has over 200+ cryptocurrency assets it supports for staking, and a few don’t require a lock-in period due to their flexibility.
One of the oldest cryptocurrency trading platforms, Kraken, was established in 2011. Staking rewards are paid twice a week. However, for recent issues, Kraken has stopped to offer its staking options to the US market.
|👍 KRAKEN PRO Pros||👎 KRAKEN PRO Cons|
|✅ It offers flexible staking||❌ There is no transparency on the fees incurred on the platform.|
|✅ Staking rewards are distributed twice a week so that withdrawals can be made twice a week||❌ Terms and conditions vary based on the token.|
|✅ It offers a wide range of tokens you can stake|
Known for the multiple earning opportunities it provides, Kucoin offers boosted earnings promotion, savings with colossal interest, dual investments, and staking investments. Ironically, many of these other opportunities rival and even beat its interest rates for cryptocurrency staking.
Kucoin was founded in 2013 and offers cryptocurrency staking for more than 50 cryptocurrencies. Most of these can be staked flexibly as they have no lock-in period.
However, Kucoin does not offer its services in the US as it needs the adequate strict KYC registration required by the government.
|👍 KUCOIN Pros||👎 KUCOIN Cons|
|✅ 700+ supported cryptos||❌ It doesn't operate in the US.|
|✅ Low fees||❌ Limited staking options|
|✅ Automated trading bots||❌ Regulatory issues in some areas|
|✅ Accepts card payments|
Cake Defi, although it is less popular than the other companies on this list, has a significant following and tremendous results. Currently, Cake Defi offers staking options for only four cryptocurrencies, namely Ethereum, DFI, Matic, and Dash.
Cake Defi has a user-friendly interface, making staking very easy to set up. With meagre trading fees (ranging between 0.1% – 0.2%), Cake Defi is cost-efficient as well and is an excellent platform. Recently, the name of this platform has been changed to Bake.
|👍 CAKE DEFI Pros||👎 CAKE DEFI Cons|
|✅ Cake Defi has a very easy-to-use interface||❌ It only offers Cryptocurrency staking for four cryptocurrencies|
|✅ It has a meagre cryptocurrency trading fee|
|✅ It has a mobile app for iOS and Android|
As you already know, cryptocurrency staking is a popular low-risk way for investors to make passive income while also providing support for the Cryptocurrency that is staked. You get rewards for locking down an amount of Cryptocurrency, thereby making money off cryptocurrencies that would have been idle. Behind the scenes, however, is the whole relationship between blockchains and their validators.
To stake your Cryptocurrency is straightforward with most cryptocurrency staking platforms. However, just betting is risky, as you should remember that even though it is low risk, it still has risk nonetheless, and you can lose money if you are careful.
The process below assumes you already have a cryptocurrency account, also known as a crypto wallet, on a trading platform that allows staking.
Firstly, when you want to stake crypto, you must decide which Cryptocurrency you would bet. This is because the interest rate for each Cryptocurrency varies based on the Cryptocurrency, the platform, and the market. We have shared some of the interest rates above, but remember that prices could have changed, so do due diligence.
Secondly, after picking a cryptocurrency to stake, the next step is buying some of that Cryptocurrency. There is usually a minimum amount of Cryptocurrency allowed to be staked, which also varies per platform. So purchase what covers or surpasses that minimum.
Thirdly, choose a method of staking. There are different methods of staking available out there. While it also varies per platform, every cryptocurrency staking platform mentioned above supports flexible staking, enabling you to access your stake anytime. There may be better choices for you, though, so decide which staking strategy works best for you.
Fourthly, start staking. Once all the steps above have been completed, all that remains is for you to make a stake in the cryptocurrencies you bought and start earning rewards in return.
In conclusion, cryptocurrency staking has become popular and widely accepted as it offers crypto investors low-risk, passive income opportunities. It is, however, essential to buttress the point that while cryptocurrency staking is low risk, there is still an element of risk, and you can end up losing money.
Also, considering the nature of this opportunity, it is essential to be wary of platforms that promise very high staking rewards. While you may find other outlets that promise higher interest than the ones listed here, security was also considered the best among all the available cryptocurrency-staking platforms.
Cryptocurrency staking is simply locking up a certain amount of your Cryptocurrency to support a specific cryptocurrency while also making passive income off it.
This is simple. You deserve the Cryptocurrency you want to stake; buy some of the chosen cryptocurrencies, choose a staking method, and then place your stake. This assumes you already have an account on a platform that allows staking. If you don’t, then that would be step two.
Yes, the primary motivation behind cryptocurrency staking is the desire to make passive income off it, and this is done by the interest, called rewards, received on the Cryptocurrency staked.
This varies depending on the platform. While some crypto staking platforms charge for crypto, all the ones listed above do not.
Yes, it is very legal to stake crypto. Most Cryptocurrency staking platforms are registered and have insurance to cover cyber attacks. Would this be possible if it weren’t legal?