Want to earn passive income from your crypto? Staking is one of the ways to do it, but not without risk. Discover the best staking platforms to research in 2023, including DeFi staking platforms.
How to choose the best platform for staking
There are many crypto staking platforms available, both centralized and non-custodial. Some factors to consider when researching your staking platform include:
- Cryptocurrencies available: Though most investors think of Ethereum when it comes to staking, there are a huge number of cryptocurrencies available to stake - even those not using a PoS staking mechanism are available to stake using specific third-party services or DeFi protocols, and many lesser known cryptocurrencies often offer a higher return on investment than more popular cryptocurrencies.
- Rate of return: Unlike interest rates from traditional financial providers, the APR/APY on staking can be in the double or even triple digits. But those high interest rates often come with risk, so do your own research before investing.
- Risk: Crypto staking isn’t without risks, like all crypto investments. Many investors will remember all too well the collapse of prominent yield platforms like Celsius and BlockFi in 2022, with many investors still waiting to see if their investments will be returned to them after being frozen on the platforms. It’s difficult to know which platforms are the safest, but generally speaking, sticking to larger centralized platforms with some kind of insurance or platforms with transparent proof of reserves is the safer option for custodial staking. Alternatively, you can use non-custodial staking platforms to ensure the only person you need to trust with your crypto is yourself.
- Custody: There are custodial (centralized) and non-custodial (decentralized) staking platforms available, each with its pros and cons. You should carefully consider the benefits and risks of each (or check out our summary of the differences below) before deciding which is the best platform for you.
- User-friendliness: If you’re new to crypto, some staking platforms, particularly non-custodial DeFi platforms can be daunting to navigate. Fortunately, leading centralized exchanges offer simple one-click staking solutions for investors new to the market to help them earn a passive income with little technical knowledge.
- Restricted countries: In many instances for centralized staking platforms, you’ll need to check whether the platform actually offers staking products in your country. For those in the US in particular, the recent SEC crackdown on crypto staking has meant many exchanges have withdrawn staking products for US investors.
What are the best staking platforms in 2023?
Some of the best staking platforms in 2023 to consider in your research include:
- Cake DeFi
- Rocket Pool
*Rates & currencies available are subject to availability and may change.
Compared to many other exchanges, Coinbase offers a rather modest 9 cryptocurrencies available to stake, including:
This said, assets eligible for staking rewards are updated regularly, as are the interest rates available. Coinbase advises that investors can earn anywhere between 1% APY and 6.12% APY depending on the crypto they stake.
You'll be able to see exactly how many rewards you've earned and the current rate you're earning in your Coinbase account. This is calculated in cash value at the point you received the reward, so for example, if you earned $5 in ETH, the amount will be calculated as $5 - even if the ETH price varies.
One of the main appeals of using Coinbase over other staking platforms is the security of knowing your assets are with a leading crypto exchange. Not only does this offer market-leading security practices for your crypto, but the user-friendly platform makes on-chain staking far more accessible for novice investors looking to stake Ethereum, Tezos, Cosmos, Solana, Cardano, and more. As well as this, unlike with direct staking where investors may have to lock up their assets for a specific period of time, in most instances, investors can opt out whenever suits them using Coinbase Earn.
A word of warning though for US investors - if you stake using Coinbase Earn, and earn more than $600 in staking rewards, you'll receive a 1099-MISC from Coinbase, so the IRS will know about your staking rewards (and learn more about how Coinbase reports to the IRS).
As well as this, Coinbase has received a Wells Notice from the SEC (Securities and Exchange Commission) recently, alleging that staking products constitute unregistered securities. Coinbase's CEO, Brian Armstrong, has since tweeted, "We are right on the law, confident in the fact, and welcome the opportunity for Coinbase (and by extension the broader crypto community) to get before a court... Going forward the legal process will provide an open and public forum before an unbiased body where we will be able to make clear for all to see that the SEC simply has not been fair, reasonable, or even demonstrated a seriousness of purpose when it comes to its engagement on digital assets."
KuCoin offers a large staking product selection - with additional earn product types included in their platform. Some of the most popular cryptocurrencies to stake include:
KuCoin states specific flexible staking products offer anywhere between 2.37% to 34.07% at the time of writing, although rates are regularly updated so these may change.
As well as this though, KuCoin offers a variety of other earn products, similar to staking products, including savings, dual investments, and boosted earning promotions for new users - and many of these products advertise higher interest rates. For example, for Bitcoin hodlers, KuCoin advertises a fixed dual investment product (non-principal protected) with a 156.7% APR or a flexible savings product with a 0.26% APR. Of course, investors should always do their own research on dual investment products and their unique risks.
KuCoin may appeal to some investors due to the wide array of altcoins available and promotional offers, as well as the large range of earn products on the platform.
For US investors though, a word of warning, KuCoin is not licensed in the USA as it doesn't enforce the KYC processes necessary to operate within regulations. Of course, this doesn't mean US users can't use the exchange, but they'll be subject to limited products without KYC and there is always the risk of your account being frozen if you use an exchange from a restricted country.
Binance Earn allows investors to earn interest on their idle assets, with a wide variety of staking, farming, and dual investment products available.
When it comes to staking, Binance offers ETH 2.0 staking, allowing users to easily stake ETH in one click and receive BETH tokens at a 1:1 ratio. This allows users to stake ETH without losing liquidity and later redeem ETH staking rewards when the Shanghai Upgrade allows staking withdrawals (approx. 6 to 12 months following the Merge).
As well as this, Binance offers DeFi staking products - both with flexible and fixed options. Binance advertises the estimated APR on these products between 0.05% and 6% at the time of writing and tokens include:
Binance also offers the Simple Earn Product - a one-click staking solution with flexible and locked durations - for a range of coins and many of these products are principal protected. Binance states that principal protection means the same number of tokens you deposit to Simple Earn will be returned to you along with yields paid out in the same kind of token. At the time of writing, Binance advertises estimated APR rates for Simple Earn products between 0.67% and 37.9% and Simple Earn products featured include:
Binance also offers investors high-yield Simple Earn products and Dual Investment products. These products are not principal protected and you should always DYOR to understand the risks involved.
Finally, there's Binance's auto-invest feature. This feature regularly invests a pre-determined amount into a given cryptocurrency and automatically issues daily earnings.
Many investors looking to stake crypto may find Binance appealing thanks to both the range of staking and earn products available, as well as the fact that the industry-leading exchange offers unmatched security and is generally regarded as one of the safest and most trustworthy exchanges.
All this said, Binance has faced considerable scrutiny from regulatory authorities in the US recently, with staking products and stablecoin BUSD a particular focus for the SEC. An SEC official claimed Binance US was operating an "unregistered securities exchange" in the Voyager Digital bankruptcy hearings, and Binance's stablecoin issuer Paxos has also recently received a Wells Notice from the SEC, labeled BUSD an unregistered security.
Despite these recent regulatory issues, Binance is a highly compliant crypto exchange, and in fact, issues users (and the IRS!) with income of more than $600 (including from staking rewards) with a form 1099-MISC.
Crypto.com offers staking options for more than 21 cryptocurrencies, from the most popular options like Ethereum, Cardano, and Tether, to less well-known projects like Celer Network, Elrond, and Pax Dollar.
The interest rates available on Crypto.com vary considerably based on four factors:
- The token
- The amount
- CRO lockup
Investors who have CRO locked receive more favorable rates than those who do not. Similarly, the longer a period an investor stakes for, the better the interest rate will generally be.
As well as this, Crypto.com offers private members exclusive perks, including an additional 2% PA, which is distributed in CRO tokens.
All this said, the estimated PA rates for Crypto.com staking products are currently advertised as between 1% to 12.5% - depending on the term, CRO lockup, and whether you're a private member.
Like with the other large centralized staking platforms on this list, investors may find Crypto.com a good option to stake their crypto due to the reliable and trustworthy nature of the platform.
For US investors, Crypto.com hasn't yet faced the same scrutiny from regulatory authorities like the SEC yet- but that doesn't mean it won't! As well as this, US investors should be aware that Crypto.com issues 1099-MISC forms to users who earn more than $600 in rewards from staking and other earn products on Crypto.com.
Another crypto exchange behemoth, Kraken offers on-chain staking for users, allowing investors to stake crypto in one click and often removing any of the limitations that may be in place - for example, minimum staking deposits. Currently, Kraken offers on-chain staking for the following blockchains:
Like many other centralized staking providers, Kraken advertises both flexible and fixed period staking (although it's known as flexible and bonded staking on this specific platform). Bonded staking products generally advertise higher estimated rewards.
Staking rewards rates vary depending on availability, but at the time of writing, Kraken advertises an estimated APY between 1% to 24% depending on the token and staking period.
Cake DeFi might be smaller than some of the crypto giants on this list - but the platform has attracted more than 1 million investors worldwide, paid out more than $400 million in rewards, and currently holds more than $1 billion in customer assets.
Despite what the company name might suggest, Cake DeFi is actually a centralized platform that aims to help investors gain easier access to DeFi products.
When it comes to staking - Cake DeFi has a modest selection of just four cryptocurrencies, including:
Rates are subject to change but at the time of writing, Cake DeFi advertises between 4.6% and 12.31% APY and states rewards are paid out every 12 hours.
Unlike many other centralized staking solutions, Cake DeFi staking products are products that allow investors to earn staking rewards as part of a proof of stake consensus mechanism by joining fully transparent node pools via Cake DeFi, as opposed to a variety of other earn products that may carry more risk.
As well as this, Cake DeFi advertises a number of other investment opportunities including earn products with up to 10% APY, liquidity mining with up to 17.75% APR, loans, yield vaults, and more.
Many investors may find Cake DeFi an appealing option for a taste of the huge variety of DeFi investments available while sticking to a user-friendly platform.
All this said, for US investors, Cake DeFi is currently not available due to regulatory issues. See a full list of restricted countries.
Nexo crypto exchange offers a number of earn products - including staking products.
For those looking to stake Ethereum, Nexo offers ETH smart staking. Like many other Ethereum liquid staking solutions, Nexo allows users to stake ETH and receive NETH (Nexo Staked Ethereum) in return, and earn staking rewards which are paid out daily in NETH - as opposed to waiting for staking rewards to be available for withdrawal by staking directly using a non-custodial wallet.
Smart staking rewards offer an advertised return of 4% to 12% APY in compound interest, and you'll receive your rewards daily to either your savings or credit wallet on Nexo. As well as this, the minimum deposit required for ETH smart staking on Nexo is just $10, which is a far cry from the 32 ETH required to stake directly!
You can use your NETH tokens too, either to borrow cash or stablecoins on Nexo to reinvest or simply to earn interest in your Credit Line Wallet.
Smart staking isn't the only earn product available on Nexo either. Investors can use Nexo Earn to earn interest on more than 30 cryptocurrencies. Interest rates vary depending on market conditions and your loyalty tier on Nexo, but are as high as 36% for platinum members.
However, yet another word of warning for US investors, in 2022, Nexo announced it was phasing out all services for US investors - starting with earn products.
Lido is a decentralized liquid staking platform. It was one of the first of its kind and still remains one of the most popular with more than $10.2 billion TVL.
Though it all started with Ethereum, you can now stake the following tokens on Lido:
Up until March 2023, you could also stake Polkadot and Kusama with Lido, but you cannot any longer due to the termination of the development and technical support for Lido on Polkadot & Kusama.
For the assets still supported, the way Lido works is pretty simple. Choose a crypto to stake, connect your wallet, and select the amount of crypto to stake. Once you've staked your crypto, you'll receive tokens in return, representing your staked crypto - either stETH tokens, stMATIC tokens, or stSTOL tokens depending on which crypto you staked.
You can then use these tokens on other DeFi protocols - whether that's providing liquidity on Curve, using them as collateral to take out a loan on Aave, or depositing your tokens to earn a yield on Yearn Finance.
Lido essentially lets you reap the rewards of non-custodial staking, without the downside of losing liquidity. It remains a popular choice for investors worldwide, particularly for those who don’t want to get tangled up with centralized crypto exchanges and the various operational and regulatory requirements and issues they’re facing.
Of course, no crypto investment is without risk. Using the Lido protocol has risks, in particular, the stETH/stSOL/stMATIC token price risk. As these assets are pegged to the value of other crypto assets, there is a small risk of them depegging in very turbulent market conditions. As well as this, there are technical and security risks around using smart contracts which some hackers have exploited for other DeFi protocols previously, although Lido has not faced such hacks.
Stakely is another non-custodial staking platform and validator provider that allows investors to earn passive income from more than 35 blockchains. We won't list them all here, but some of the most popular staking options include:
Rates vary, but at the time of writing vary between 5% and 87%.
The exact way staking with Stakely works varies a little depending on the crypto you're staking, but generally speaking, it's as simple as connecting your non-custodial wallet, finding the delegation/staking options, and selecting Stakely as your validator.
Using Stakely as your staking platform comes with a range of benefits, including lower fees than centralized staking platforms offer, and a strong community with helpful guides on staking queries for a number of popular blockchains. As well as this, unlike many other non-custodial staking solutions, Stakely has a Staking Insurance Fund - a protective measure to cover any staking losses resulting from accidents like slashing events.
Thanks to really helpful step-by-step guides, Stakely makes non-custodial staking accessible and simple for users of any experience who might otherwise be tempted to use centralized crypto exchanges.
Of course, using Stakely comes with the same risk of staking crypto generally - including locked funds being vulnerable to market volatility, loss or theft of your private keys, and slashing. Although of course, the risk of slashing is greatly reduced by using a popular and reputable validator like Stakely.
Last up on our best staking platforms list is Rocket Pool. Rocket Pool is a decentralized Ethereum staking protocol, and although it's small, it's still a contender for those looking for non-custodial staking platforms for Ethereum, without many of the downsides like minimum deposits or liquidity. Rocket Pool is plenty reputable, with more than 438,000 ETH staked and 2,223 node operators.
The platform offers two Ethereum staking solutions - depending on how you want to stake.
If you want to stake and run a node, you can do so with Rocket Pool with some significant benefits. For starts, you'll only need a minimum staking deposit of 16 ETH with Rocket Pool, as opposed to 32 ETH. As well as this, you'll gain additional RPL tokens as a reward for providing RPL collateral (something you have to do as a kind of insurance for the protocol). At the time of writing, staking and running a node with RPL offers 7.10% APR plus variable RPL rewards. The RPL token is currently trading at around $40, so these rewards may be lucrative!
Your second option for Ethereum staking on Rocket Pool is to stake without running a node. If you stake without running a node, your minimum deposit is 0.01 ETH. As well as this, this staking product is a liquid staking product, so when you deposit ETH, you'll receive rETH tokens in return which you can use in other DeFi protocols to compound your interest. At the time of writing, staking ETH with Rocket Pool offers 3.91% APR.
Of course, as a lesser-known project, you might have concerns around security, but Rocket Pool has worked with leading crypto tech auditors to help it navigate these risks including Sigma Prime, Consensys Diligence, and Trail of Bits. As well as this, Rocket Pool has a bug bounty to encourage white-hat hackers to help secure Rocket Pool ethically.
With our roundup of the best staking platforms out the way, let’s take a look at some common queries around staking to cover any lingering questions you might have.
What’s the difference between PoS staking and DeFi staking?
Confusingly, staking can refer to two entirely different transactions - staking as part of a proof of consensus mechanism and staking using DeFi protocols.
For the former, Proof of Stake (PoS) is a consensus protocol in blockchain technology. This means it's the means by which users validate new blocks and transactions. In a PoS consensus mechanism, users stake a given amount of cryptocurrency and this gives them the right to validate new transactions on the blockchain and earn a reward for doing so.
Meanwhile, DeFi staking can actually refer to a huge number of protocols, all of which work slightly differently. You can learn more in our DeFi guide, but effectively, it refers to staking your asset in a given protocol in order to earn a reward. How rewards are paid out and for what reason depends on the DeFi protocol you’re using.
What’s the difference between centralized and non-custodial staking?
You can either stake directly (or via a decentralized protocol) using a non-custodial wallet or using a centralized third-party. Both have pros and cons.
For example, if you wanted to stake Cardano directly - you could use a non-custodial wallet like Yoroi or Daedalus to do so. Generally speaking, it’s a little more technically complicated to stake directly, you may need to delegate to a validator or run your own node, and there may be requirements for you to stake a minimum amount. If you need to delegate to a validator, you’ll also need to trust that validator’s reputation.
Meanwhile, if you want to stake with a third party, this is generally done using centralized crypto exchanges, like the ones we’ve mentioned above. This generally requires less technical knowledge to do so and often removes the requirements around minimum deposits, or the need to run a node or find a validator. However, you need to trust your custodian. Many staking platforms collapsed throughout 2022 due to mismanagement of funds and offering returns that simply weren’t sustainable. As well as this, most third-party staking providers charge a small fee in return for the service, reducing the amount of staking rewards you’ll receive.
What is liquid staking?
Liquid staking is a newer concept that emerged to solve one of the biggest pitfalls of staking - that is a lack of liquidity. Generally speaking, when you stake your crypto as part of a PoS consensus mechanism, you’ll lock it up for a given period, meaning you no longer have access to that section of your portfolio. It’s not the end of the world, but in an ever-changing market - investors want liquidity.
As such, liquid staking emerged as the solution. Liquid staking protocols let you stake crypto through a decentralized protocol. When you stake using a liquid staking protocol - you’ll receive tokens in return representing your stake. These tokens often accrue value based on your staking rewards, but you can also use them as you’d use any other token in a number of other DeFi protocols in order to compound your interest and maintain liquidity.
How does crypto staking work?
It very much depends on the staking platform you’re using - but as a very basic explanation when you stake crypto, you’re generally locking up your crypto in order to validate transactions on a given blockchain and earn a reward for doing so.
Are there fees for crypto staking?
Yes. Both centralized staking platforms and staking pools generally take a small fee (usually around 2% to 5%) for providing the service. If you’re staking directly using a non-custodial wallet, you’ll typically pay a small network fee in order to delegate your crypto, many of which are refundable at the point you unstake.
Is staking crypto profitable?
Yes. Staking is one of the most popular ways to earn passive income from crypto assets as it offers a relatively safe investment without any of the equipment costs associated with other consensus mechanisms like PoW crypto mining. However, staking is not without its risks and you should always DYOR.
Are crypto staking platforms safe?
We’ve harped on about this a lot - but you have to be able to trust your staking platform, especially custodial staking platforms. Many platforms offering earn products including staking in 2022 collapsed due to offering unsustainable returns and investors were left with their funds frozen on the platform and millions in losses. If you're using a centralized staking platform that takes custody of your crypto, make sure you trust that platform and that you never invest more than you're willing to lose, or consider using a non-custodial staking platform.
Are staking rewards taxed?
Yes, generally speaking, most tax offices around the world take the same view that staking rewards are subject to tax. You’ll usually pay Income Tax based on the fair market value of your staking rewards at the time you received them. As well as this, if you later dispose of your staking rewards by selling, swapping, or spending them, you may need to pay Capital Gains Tax on any gain as a result. Learn more about crypto tax in your country in our guides.
Is staking banned in the USA?
No, staking is not banned in the USA, but the SEC and other regulators are having a real crackdown on crypto staking of late. Unsurprisingly, this has been met with widespread criticism across the industry.
For context, this crackdown - although intensifying in the last year - isn’t new. The SEC first brought charges against Ripple in 2020, claiming the company was conducting a $1.3 billion unregistered securities offering. Since then the SEC has gone after stablecoin BUSD by issuing a Wells Notice to issuer Paxos. The SEC has also issued notices or brought charges to crypto exchanges Binance, Coinbase, and Kraken - the latter of which opted to settle for $30 million and withdraw staking services from the US.
Coinbase on the other hand, looks ready to take on the SEC in court, with the CEO releasing a Twitter thread, stating, "We are right on the law, confident in the fact, and welcome the opportunity for Coinbase (and by extension the broader crypto community) to get before a court... the SEC simply has not been fair, reasonable, or even demonstrated a seriousness of purpose when it comes to its engagement on digital assets."
In other words, there is a severe lack of regulation and guidance currently and the SEC seems to have decided crypto staking as the flavor of the month. It doesn’t mean staking is illegal in the US, just that the SEC is alleging some crypto platforms are not registering product offerings correctly as crypto may be viewed as a security in the absence of any other guidance. Interestingly, the exchanges charged or accused of misconduct so far are generally highly compliant exchanges that comply with all the existing crypto regulatory and operational frameworks in the US. It isn’t clear the stance the SEC will take for non-custodial staking platforms or wallets that operate outside of its reach.
A ruling on Ripple’s case is expected imminently which may give further clarification on whether crypto may be viewed as a security in the US.
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