O cryptocurrency staking has recently gained a notable level of hype, mainly because of the financial return opportunities of crypto-assets. Investors are looking for the best cryptocurrency stacking platforms in 2022 to take advantage of cryptocurrency stacking by making informed and managed decisions.
What is staking?
Staking is an investment strategy that allows cryptocurrency holders to earn passive income by making idle assets work. Such staking can yield compounded betting rewards by locking in crypto-assets, similar to a high-yield savings account at a bank. Users deposit funds that the bank, or in this case the cryptocurrency platform, lends to others. Legacy financial instruments pay back a small portion of any interest earned on that loan. However, cryptocurrency holders can retain a much larger share of the profits. There are several ways to participate in steaking. One of the easiest ways is “soft-stacking” with a centralized exchange (CEX). When users fund an account with soft-stacking on CEX, they have the ability to earn recurring rewards for staking on top-tier cryptocurrency assets. In addition, betting with a decentralized funding protocol (DeFi) or decentralized exchange (DEX) allows users to bet on a wide range of exotic crypto-assets and participate in advanced investment strategies such as liquidity mining and harvesting.
Some betting platforms offer yields to lock in crypto-assets for a predetermined period. Others offer flexible betting products that allow users to bet and withdraw at any time. In addition, betting platforms take into account different levels of risk and technical capabilities.
5 best crypto-stacking platforms
Below we have listed the top five cryptocurrency hosting platforms by number of active users, total blocked value (TVL), reliability, and annual percentage yield (APY).
Coinbase is one of the most popular cryptocurrency exchanges for beginners. It provides direct access for new users and allows users to exchange a wide range of crypto assets. In addition, Coinbase is quickly becoming one of the leading cryptocurrency betting platforms due to its ease of use and high level of security.
Coinbase users have access to a variety of income opportunities. As of this writing, Coinbase users can earn up to 5% annually on Cosmos (ATOM), 2.6% on Cardano (ADA), 2.33% on Dai (DAI), 4.63% on Tezos (XTZ), 1.67% on Tether (USDT) and 0.45% on Algorand (ALGO).
Binance is the largest cryptocurrency exchange by trading volume. It is a platform for investors and traders of all levels. In addition, the platform offers some of the most diverse betting options among all cryptocurrency exchanges through the Binance Earn portal. Products include Fixed Savings, Flexible Savings, Dual Investment, DeFi Stacking and Liquidity Cultivation.
Binance’s Flexible Savings subscription-based product offers an estimated annual percentage yield (APY) of 10% in U.S. dollars up to $2,000. The Binance Fixed Savings product offers 5% APY on USDT when lexemes are locked in for 30 days and 9% when locked in for 60 days. In addition, this product has an “auto-renewal” feature to pay compound interest. In addition, there is the same yield for various leading crypto-assets.
Binance Liquidity Farming offers a higher potential yield with a corresponding risk. This allows users to provide liquidity to agricultural groups. Users deposit equal amounts of two assets to receive transaction fees and flexible interest on more than 70 trading pairs. This includes single-digit APYs for Stablecoin pairs and top-tier crypto assets such as Ethereum (ETH), Avalanche (AVAX), Dogecoin (SOBA), In Pea (DOT) and Chainlink (SPY). At the time of writing, users could earn approximately 24.74% APY on APE/USDT (ApeCoin/Tether), 23.57% on AVA/USDT (Travala/Tether), 23.38% on GMT/USDT (STEPN/Tether) and 28.42 % in SANTOS/USDT (Santos FC Fan Token/Tether).
Blaterbit.com is offering more rewards to Cronos Utility Token (CRO) holders. Users can choose lock-in periods of one or three months and receive weekly rewards for compound bets in more than 40 cryptocurrencies and stackablecoins. This includes top-tier assets such as bitcoin (BTC), Ethereum (ETH), Avalanche (AVAX) and Dogecoin (DOGE).
The platform offers a variety of DeFi stacking services using affiliate protocols. Users can earn revenue from DeFi on more than 35 tokens through Yearn Earn V2, Compound, Aave, Blaterbit.org Chain Staking and Cosmos Staking. In addition, these products have no lock-in period, so inventors can withdraw funds at any time. Experienced traders with a risk appetite can earn over 500% p.a. with DeFi , a product that allows users to buy at a low price and sell at a high price two cryptocurrency assets without commissions. This product is only for experienced investors and should be approached with caution. As with any other financial product, be sure to do your own research and never invest more than you can afford to lose.
Aave is an open-source, non-custodial protocol for interest on deposits and loaned assets. The protocol’s own token is called AAVE and serves as a management token, allowing the community to collectively determine the direction of the protocol.
AAVE owners can put their AAVEs on a security module to increase the security of the protocol and earn rewards. In the event of a deficit, up to 30% of your share can be reduced to cover the deficit, providing an additional layer of security for the protocol.
dYdX is the most powerful open trading platform for advanced cryptocurrency-based financial products, powered by Ethereum blockchain. Trade perpetual contracts with low commissions, high liquidity and up to 20x buying power.
All major new smart contracts have been audited by Peckshield. No significant or high-priority security issues were found. Major management contracts and tokens are branched out based on AAVE management contracts that have been audited by CertiK, Certora and Peckshield and tested on the core network for several months.
Cryptoassets are inherently risky. Consequently, investors should always exercise caution when interacting with any betting platform. One of the most common risks associated with stacking cryptocurrencies is temporary loss. A non-permanent loss occurs when the value of your staked assets drops during your bet. If you bet a token and it falls in value, the wagering reward may not be enough to cover your loss. In addition, lock-in periods can make it difficult to access your assets in a timely manner to avoid temporary losses.
Betting requires you to hand over custody of your assets. Even large cryptocurrency betting platforms are susceptible to hacking and theft. In the case of DeFi betting, the loss of funds can be permanent and irreversible. Thus, it’s worth checking the security of the betting platform before using it. Also, be sure to find out how safe your funds are on any platform. If you plan to become a validator for the PoS blockchain, you could lose your stacking rewards due to improper transaction validation or maintaining consistent uptime. In addition, the cost of being a validator changes dramatically as global power bills rise.