Staking crypto is a process by which crypto investors can earn rewards for using their digital assets to secure the blockchain network. There are many ways to stake; you can get technical and run a validator node on the blockchain yourself, or you can trust the exchange to pool it’s users resources and do it on your behalf – which is what most people do.
Staking usually requires users to lock up your coins in a digital wallet for a specific period of time, during which they cannot be spent or traded. Some staking programs are flexible and allow you to unstake at any moment, though the rewards are less attractive.
In return for their participation, stakers earn a portion of the interest generated by the assets they have staked. The concept staking rewards in crypto is similar to dividends in the traditional financial world. Shareholders are rewarded quarterly by the company by distributing a portion of the company’s earnings. In crypto, staking is rewarding holders by distributing a portion of the fees earned for securing the network.
Crypto staking can be a great way to earn passive income and help support the growth and development of the blockchain industry. As opposed to the quarterly model of the traditional financial system, staking rewards are distributed on a daily or weekly basis. Of course, it is important to note that staking your crypto to earn rewards comes with some risks. For example, if you are staking via an exchange, you assume counterparty risk and trust the exchange to pay out. In addition, if you lock your crypto to stake it, and the price of the asset falls sharply, you may be left with losses since you are unable to cash out while your crypto is locked. Nevertheless, crypto staking is widely popular, and not staking is missing out on an opportunity to grow your crypto, especially if you stake with a reputable party. All in all, staking crypto is a profitable endeavour for those willing to take on some risk and patient enough to wait for the rewards.
Top Crypto assets by Staking reward
Bitvavo – European Focused, Small Offering, Minimal Returns.
Are you based in Europe and looking for a way to grow your crypto with a safe and registered exchange? Bitvavo might be your answer. Bitvavo offers flexible staking on 17 coins and is a perfect exchange for beginners looking to venture into crypto staking. The rewards are on the lower end of the spectrum compared to other rivals, but the security that comes with a registered exchange and the ease of staking offered by Bitvavo might make it an excellent choice.
Staking with Bitvavo is straightforward, and most beginner and intermediate traders not familiar with staking shouldn’t have any issues understanding how staking works. We like that it’s flexible, and there’s no need to lock up your crypto to earn rewards on it. It’s easy to control from one central dashboard and is available from desktop and app, so you’re never caught out. If you’re looking for a staking platform to learn how staking works, you will find value in using Bitvavo. If high rewards are your number one priority, we don’t think you’ll be happy using Bitvavo and would find more value using a staking platform like Binance or Kraken to stake your crypto.
Read our full review of staking on Bitvavo.
Crypto.com – Flexible Staking, But with Low Rewards
Crypto.com is one of the most recognizable names in the crypto space, so, naturally, you’d expect it to have an attractive staking offering if the rest of its exchange is anything to go by. Crypto.com supports staking for 49 coins, including a variety of stablecoins. You can choose to stake flexibly or for 1- and 3-month terms, with higher rewards awarded the longer you stake your coins. You can also earn double rewards by staking its native coin, CRO, with your other staked crypto. Rewards range from 0.2% – to 14.5% APR depending on the coin and staking term, and rewards are paid out weekly.
We liked that Crypto.com lets you flexibly stake all its coins, but the rewards are not among the highest. The most you can get is 5% on DOT and MATIC; the rest of the coins will only give you a potential 0.5% – 2% return. When you enter your crypto in locked staking for a minimum of 1 month, the rewards start to look a bit better but to gain maximum rewards you need to commit to 3 months. Because Crypto.com does not have a proper desktop interface, staking is only available using the Crypto.com mobile app. The positive is that staking crypto on the app is very straightforward. If you don’t mind locking your crypto up for 1 – 3 months, we think Crypto.com would be a good choice for you.
Read our full review of staking on Crypto.com.
Binance – Multiple Staking Tools, Easy Management, High Rewards
Binance is the world’s largest exchange and really doesn’t need much of an introduction. Its name is synonymous with crypto trading, and its staking services are no different. Binance offers one of the best investment platforms in Binance Earn. Users can use multiple staking tools to help grow their crypto, including Binance locked and flexible staking, DeFi staking, ETH 2.0 Staking, Binance Savings, Binance Launchpool, and Binance Liquid Swap. It supports 182 staking coins with flexible and locked terms ranging from 5 to 120 days. Interest is compounded (APY), and multiple potential APY of more than 100% are on offer on selected coins.
Binance has taken the complexity out of staking and has made it accessible to the masses, with an easy-to-use platform on both the desktop and mobile versions of Binance Earn. With all of the staking options offered, one would be forgiven for thinking it must be a nightmare controlling everything if you use more than one product. However, Binance has made it easy by letting you control everything from one central dashboard.
The only downside is that if you are a novice investor and only use Binance Lite, the less complicated trading app, you’ll need to switch to Binance Pro to access the staking tools. Staking is an excellent way to earn rewards and interest on your idle crypto, and we think you’ll be hard-pressed to find a more attractive staking option than with Binance.
Read our full review of staking on Binance.
Coinbase – Small offering, Unattractive Rewards, High Fees
Coinbase is one of the biggest U.S.-regulated exchanges. U.S. regulation usually limits high-yield interest products depending on how many states the exchange is regulated. Coinbase offers 10 staking coins, and you can only participate in locked staking, with lock-up periods ranging from 3 days to 3 months, depending on the coin, and the highest return is capped at 5.75%.
We found it hard to find anything we liked about Coinbase staking, with maybe the only positive being that it’s easy to manage from both the desktop and mobile app. To start staking, you need to join a waitlist which could take a few weeks, and Coinbase takes 25% of your rewards made from staking as a fee for providing the staking service some of the highest we’ve come across in the crypto staking world.
The only reason to stake on Coinbase is if you want the absolute easiest way to stake, and don’t mind getting subpar returns. However, even if you would like to use Coinbase to buy and sell crypto, it’s a good idea to look at different offerings to find a better staking platform. In our opinion, Coinbase’s staking offering is what currently keeps it from being THE #1 destination for novice crypto investors.
Read our full review of staking on Coinbase.
Kraken – Flexible, Attractive Rewards, An Excellent Option for the U.S. Traders
There are some decent regulated exchanges on the market for U.S. traders, but few offer attractive staking rewards. Kraken offers an easy-to-use staking tool supporting 15 coins and 2 fiat currencies. Though the number of coins might sound limiting, the rewards are attractive, ranging from 4% – to 23% RPY, and the rewards get paid out weekly or bi-weekly, depending on the staked coin. We loved that the returns are attractive even though the staking is entirely flexible, giving you the chance to unstake your coins at any point without losing any accumulated rewards.
For a predominantly beginner-focused exchange, Kraken has done well to bring a feature that is considered ‘advanced’ to the broader market of users. It’s easy to use the staking features, and the fact that it’s all flexible staking takes a bit more of the risk out of it for the beginner trader. Though limited in its offerings, it’s a good place to start staking. For the more advanced and experienced trader, there is value in staking with Kraken with its attractive rewards and flexible terms, but there are better exchanges out there with greater returns and more coins, like Binance.
Read our full review of staking on Kraken.