Staking is a process of locking your coins on a platform to get specific benefits: voting rights, a right to verify transactions, and rewards. Different platforms offer different conditions for staking. That’s why it is crucial to choose the right platform to stake your coins.
Advantages and Disadvantages of Staking Cryptocurrency
Staking crypto delivers rewards and gives some rights such as a right to vote on the project’s development direction, a right to confirm transactions and add new blocks to the chain.
But when you stake coins, you lock them in a designated wallet on a platform. They aren’t available for use within a specified period. In most cases, it is a couple of months but in rare cases, it may extend to a couple of years. If the coins drop in value, you lose some part of your investment.
Reviewing the Crypto Staking Sites
The most advantageous platforms for staking are the following.
Kraken
This platform is among the best options for fast reward distributions. The staking rewards are paid out every two weeks. The yields are very competitive.
On Kraken, you can stake over 15 coins. Staking is initiated onchain for all coins but Bitcoin.
The best APY rate is 20% for staking Kusama, Mina, and Kava. Other rates are competitive, too, if you compare them with staking rates on other platforms.
The minimum and maximum staking amounts are not indicated.
Pros:
- Bi-weekly distribution of staking rewards
- up to 20% staking yields
Cons:
- No transparency with fees
Gemini
Gemini makes staking, which is normally a complex and rather complicated process, easy. The platform provides staking for 2 assets only. The APY is up to 4.8%.
Pros:
- No minimum or maximum limits
- No gas fees
- Available in all the USA states
Cons:
- A limited number of assets
- A low APY compared to some competitors
KuCoin
It is a centralized cryptocurrency exchange and a staking platform that supports multiple markets. This platform offers high yields on some of the most popular assets in the market such as Hydra and Zilliqa, with APY of approx. 40%.
There is no minimum or maximum amount to stake, and rewards are paid out only after the asset is unstaked.
Pros:
- High yields
- Flexible withdrawal conditions
Cons:
- No significant cons
Coinbase
This user-friendly staking platform offers up to 5.75% APY for staking Algorand, Cardano, Ethereum, Cosmos, Solana, and Tezos.
Pros:
- User-friendly
- High APY
Cons:
- Not available in the USA
- Rewards are paid on assets that are bought on Coinbase
- Trading commission of 1.49%
Binance
Binance is the largest exchange platform worldwide, supporting 14 cryptocurrencies for staking. Users can stake BNB, AAVE, ETH, XRP, LTC, BTC, and others for an interest rate as high as 8.7% (depending on the coin). Some coins can be staked for a flexible term, whereas others require a lock-up period of up to 120 days. The minimum and maximum staking amounts also depend on the coin you stake. The payout for staking a coin is at the end of the staking term.
Pros:
- 14 cryptocurrencies for staking
- Various staking terms and yields
- Support for yield farming
Cons:
- Some staking pools sell out quickly
Bitstamp
This exchange was launched in 2011 and is regarded as one of the well-established platforms for trading cryptocurrencies. Bitstamp also allows staking, although only Ethereum and Algorand are supported. Their respective APY is 4.12% and 1.6% with flexible staking terms. The minimum amount to stake Ethereum is 0.1 ETH, whereas no requirement exists to stake Algorand. Payouts are monthly for Ethereum and quarterly for Algorand.
Pros:
- Well-established and trustworthy platform
- No minimum staking amount for Algorand
Cons:
- Minimum staking amount of 0.1 ETH for Ethereum
- Only two cryptocurrencies supported for staking
- APY is low
MyCointainer
This all-in-one platform is another well-established crypto exchange. Besides trading, it supports over 150 cryptocurrencies for staking. The minimum amount to stake is different for each supported coin, and the APY can be as high as 101.4%. There are no lock-up periods and payouts are daily. MyCointainer charges staking fees on earned rewards, but these fees are among the lowest in the market. This platform is particularly suitable for beginners.
Pros:
- Many cryptocurrencies for staking
- APY can be high
- No lock-up period
- Daily payouts
Cons:
- Staking fees, albeit low
Stake.Fish
This staking platform is entirely non-custodial, making it one of the safest ways of staking crypto from your wallet. Stake.Fish runs public validator nodes on many crypto networks (23 at the time of writing). Hence, you essentially assign your crypto to one of these nodes, and Stake.Fish does the rest for a fee. Reward rates vary depending on the network where you choose to stake. Sentinel yields 50%-80% whereas JUNO yields 80%-160%. However, yields on other networks are lower. For example, Ethereum yields 4%-6%, whereas Solana yields 10%-20%.
Pros:
- Non-custodial
- Many crypto networks available
- Easy to use
Cons:
- Staking fees
Crypto.Com
This crypto exchange doesn’t support staking. Instead, it offers crypto interest accounts, which operate similarly to staking. The most significant difference is that cryptocurrency deposited in these interest accounts are used to fund loans. Users can choose to deposit one of the dozens supported cryptocurrencies. Withdrawal terms are flexible, but an option of a 1/3 month lock-up period is also available. As a rule, the longer terms yield better interest. The APY on cryptocurrencies is up to 14.5%, and 8.5% on stablecoins. Payouts are weekly.
Pros:
- Crypto interest of up to 14.5%
- Stablecoins are supported
- Flexible withdrawal terms
- Deposits of minimum $1
Cons:
- No staking supported
eToro Staking
This brokerage platform has become one of the best crypto staking platforms worldwide. Currently, it supports three cryptocurrencies for staking: Cardano, Tron, and Ethereum. When you purchase these digital assets on eToro, your coins will be automatically eligible for staking rewards. The share of those rewards depend on your status on the platform. For example, Diamond and Platinum members will get a 90% share. You must purchase at least $10 of crypto and hold it for 8-10 days to be able to stake. There are lock-up periods and payouts are monthly.
Pros:
- Automated staking on eligible coins
- Fully regulated platform
Cons:
- Only three cryptocurrencies supported for staking
Best Staking Coin
If you plan on staking your cryptocurrency holding, you have dozens of options. Remember that only cryptocurrencies using the PoS consensus mechanism can be staked. However, some platforms listed above will allow you to earn staking rewards on cryptocurrencies that use other consensus mechanisms. Currently, the best staking coins are:
- DeFi Coin (DEFC). Arguably the overall best staking coin at the moment.
- USD Coin (USDC). The best stablecoin to stake.
- Ethereum (ETH). The best cryptocurrency to stake on-chain.
- Binance Coin (BNB). The best cryptocurrency to stake for zero fees.
Risks of Crypto Staking
Investing in cryptocurrencies is inherently risky. Therefore, there is some risk when you stake digital coins or tokens. The most significant risks are:
- While staking generates passive income on your crypto holding, you can incur losses if the price of your cryptocurrencies decline in the open market.
- You might lose your staked coins if the platform runs into financial problems when you are staking off-chain. If it happens, the staking platform might not be able to return your investment, let alone any profit.
- When you stake on-chain, a hacking attack on the platform can lead to a loss of your coins.
Conclusion
This review presents the best staking platforms in 2023. Whether you are a beginner or a seasoned investor, you will find the right staking platform for you in our list. We briefly discussed the benefits and risks of staking so you can decide whether staking crypto is something for you. In case you decide to give staking a try, you can purchase digital coins and tokens on LetsExchange.io at competitive rates.
FAQ
Is staking risky?
Investing with cryptocurrencies always has an element of risk, and staking is not an exception. You can incur losses if the price of your coins decrease in the open market while you stake. Also, financial problems on the staking platform or a cyber-attack can lead to the loss of your investment.
Are there fees for crypto staking?
Some platforms charge fees for crypto staking, particularly those that simplify the process for users with no technical background.
Is crypto staking taxed?
It depends on the jurisdiction of the operation and place of residence of the user. Some countries tax staking rewards as regular income. It is advisable to consult a tax lawyer about staking rewards to avoid problems with local tax authorities.
Can you lose crypto through staking?
Yes, it can happen. You can incur losses because of changes of the market value of your coins or because of problems in the staking platform.
Disclaimer
Please keep in mind that the above information is based exclusively on our observations and is provided for informational purposes only. It doesn’t constitute any kind of financial advice nor represents an official forecast. Cryptocurrency is a highly volatile asset, and you are investing in it at your own risk.
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