Navigating the Landscape of Crypto Staking Platforms: A Comprehensive Guide by CoinDepo

Explore the world of crypto-staking platforms with CoinDepo. Dive into the evolution from Bitcoin to diversified investments, understand staking vs. mining, and discover profitable strategies.

Crypto staking is one of the primary ways to earn cash using decentralized currencies. It typically works by generating passive income for a staker. In this way, it’s similar to mining, but that’s where the similarities end. These two approaches are rather different, and staking itself varies from platform to platform, be that Ethereum blockchain or the CoinDepo platform offering a crypto savings account service.

This process is different for each blockchain, and some even have several distinct models within a blockchain. Depending on which network you choose, you might need to fit a completely different set of requirements. At the same time, the profits also vary, sometimes in absolutely massive ways.

So, what are the primary methods of staking? Are there any particularly curious strategies?

About Staking

Staking is different from platform to platform, but there is a common principle to many of these.

Firstly, staking implies direct participation in the various mechanisms of a blockchain, usually governing or some integral feature. For it, users need either the native cryptocurrency of a network or, sometimes, another type of digital asset. This supply will serve to provide a basis for the consequent staking.

Secondly, crypto assets must be frozen within the system. There isn’t a universal framework, but they’ll typically take an amount you specified and hold it. You can take it back, but until these funds have fulfilled their purpose it’s best not to interfere with the procedure.

Thirdly, you’ll have to wait until a process—minting, voting, et cetera—is completed for you to receive your rewards. The timeframe and requirements are always known beforehand. So, your job is to simply provide the necessary digital assets and wait patiently. Your reward might be more crypto.

That’s the common recipe. It can take on many forms and names, but at its core, it remains staking. There are plenty of platforms that allow you to make money this way, including many decentralized finance providers, crypto exchanges, and crypto lending platforms such as Nexo, CoinDepo, and Binance.

Staking vs. Mining

As a side note, it’s important to differentiate mining and staking, seeing how these two practices compare, but have unique characteristics.

Mining typically refers to the process of creating new coins using computational power through the proof-of-work consensus mechanism. It basically means that you exploit the hardware of your computer to complete tasks within a PoW-driven blockchain. In exchange, you receive rewards.

Staking, by comparison, can incorporate many different procedures. The sole common factor is that you give some of your crypto to a platform in order for it to be multiplied (and accomplish some task in the meantime). No computational power is required, making it much more accessible to the masses.

Typical Staking

Ethereum can act as a prime example of a typical staking approach. Here, the practice involves becoming a validator. The latter is a special class of users that process transactions, basically enabling this machine to tick. To become a validator, you need to stake some Ethereum.

The required amount is 32 ETH, but it’s possible for less well-off users to band together and pool their resources to meet the quota. However, they achieve it, validators receive compensation for their work in the form of more ETH arriving in their account passively.

That’s how most staking models work. While it can yield revenue, it’s not really as viable financially as some of the other schemes.

Crypto Savings Accounts: Nexo, CoinDepo, Binance

Decentralized finance is a sort of e-banking that utilizes crypto assets. Tools include everything from crypto lending to crypto savings accounts and more. As part of this, a special type of staking has emerged in recent years—based on the years-old recipe but taking advantage of the new technology.

This type of staking works more like a savings account in physical banking. Namely, you put a certain amount of digital assets in, it accumulates value, and you get to withdraw it whenever you want alongside the generated income. The principle is the same, but the payoffs are much better.

So, what are the biggest suppliers of such services at the moment?

Nexo

Nexo is one of the older providers of this service. It’s a comprehensive finance solution for digital assets that offers the options to buy, exchange, and borrow crypto of various denominations besides the staking feature. The latter is one of the most prudent financial strategies when it comes to crypto money-making.

The Nexo platform supports a large number of cryptocurrencies and stablecoins and allows users to earn up to 16% per annum by staking. This tool is specially designed to enable people to earn interest income passively. The numbers are good, and there are several excellent features, but there are platforms that offer even better deals.

CoinDepo

CoinDepo is a newer solution and specializes directly in staking, or the “Compound Interest Accounts”, as it calls them. It enables users to earn up to 24% in a year by depositing a flexible amount of funds. There are plenty of payout and compound interest plans for every single digital asset. CoinDepo supports a wide range of assets, including the most popular stablecoins and major cryptocurrencies. Even though Nexo provides more asset options, most of them are quite minor. At the same time, the interest rates offered by CoinDepo on major cryptocurrencies and stablecoins are significantly higher than those offered by Nexo and other providers.

The other big advantage is that CoinDepo also provides the option for instant credit to any user with a crypto deposit. As long as your funds continue to passively earn interest, you can also take out an interest-free loan. The interest you already gain from your crypto deposit will more than compensate for whatever interest they might’ve charged you with. This way, the two features work together perfectly.

Binance Earn

Binance Earn is another staking product offered by the largest crypto exchange Binance, which currently dominates a large part of the crypto world. There are other financial solutions launched by the same company. It does mean that it’s not a priority of theirs as there is still a neat, streamlined functionality.

There are hundreds of assets, including many curious minor cryptocurrencies found on the Binance exchange. It means that the two parts of this wider system are integrated to a degree, allowing you to purchase a certain crypto coin and grow it without speculating on the market. However, interest rates on major cryptocurrencies and stablecoins are relatively low, and payout options are widely different from asset to asset. They are often not as profitable as other platforms.

Conclusion

The cryptocurrency staking market offers a lot of curious options with different emphasis. Nexo provides a package of financial services, with staking among them. CoinDepo has a strong focus on staking as it is its core service, resulting in increased profitability and flexibility. Binance provides a large abundance of assets, as well as integration with their native exchange.

It means that, thankfully, you can make your choice depending on your preferences and priorities.