Are you looking for a way to earn money passively ?
Or to invest with a high return?
Then staking crypto coins, or crypto staking, is a good option.
You can get up to 10% interest on your Bitcoins and other coins (Altcoins / Alts).
To a layman, a strike quickly looks like a simple interest or dividend on your investment in crypto currency . Not surprising, because it also means that you get a percentage on your investment as a profit. The effect is therefore the same, but what does it mean technically?
Crypto coins work on a blockchain that keeps track of all transactions. There are different techniques for this, but the model that is important here is very Proof-of-Stake (PoS). That's where the term strike comes from. So coins are needed to make the blockchain work and you can participate if you have the right coins.
The companies behind the crypto coins make money with the blockchain and therefore benefit from enough investors, or rather a lot to make them work better and faster. That's why they give you a reward. And that rises to tens of percentages .
You have to add your coins to a staking pool and it often has to meet a number of conditions . Firstly, it must be available at all times and often there must also be a minimum of coins in it that must also be secured for a certain period of time. Especially if you want to arrange this yourself from your own wallet on your own server or computer, this has quite a few snags.
But there is an easier way: there are also platforms where you can stake your coins. They then arrange the technology and also important: security against, for example, hackers who want to steal your coins.
Moreover, the advantage with, for example, the best platform Bitvavo is that you are not obliged to lock your coins for a minimum period or have a minimum number of coins to be able to stake. They combine your coins with those of other users in a large pool to overcome this.
All you have to do is tick the box to make your coins available to the strike program and the rest will happen automatically. Your stake rewards are automatically paid to your account / wallet. Often in the same currency, but sometimes also in a different currency, read that carefully.
If you don't have any coins yet, Bitvavo is highly recommended, because this is the cheapest broker at the moment to buy Bitcoin and many altcoins (over 50 different ones) and up to 1000 US dollars this is even free , so without the normal transaction costs.
The yield varies per coin and also the way you stake. If you do this via a platform, the yield is a bit lower, but then everything is arranged, such as that your coins are accessible and secured.
Now you shouldn't just blind yourself to one percentage. It is paid weekly or sometimes even more often, which gives you a large interest-on-interest effect. In other words, if you already earn interest in the first week, you will also receive interest on that profit the following week.
This ensures that your money increases exponentially. Or actually the value of your portfolio. Only when you calculate the interest on interest over a whole year can you compare it with other investments that give you an interest on an annual basis, such as your savings account on investing in P2P credit .
There are plenty of coins you can stake. We recommend that you not only choose based on the possible interest rate, but also look at which coins are a good investment in themselves so that they also retain their value or grow in value. Read our article about best crypto coins to invest in .
In addition, it is also smart, just like with any other way of investing and investing, to ensure a diverse portfolio so that you spread your risk. So bet on multiple coins. You can read about the risks that exist below, but you will absorb the 2 most important dangers in this way.
|Currencies||Estimated yield per year|
|Bitcoin Cash BCH||0.89%|
Yes there are, because that is also the reason that a fairly high reward is given. Not everyone takes part voluntarily. Now we have to say that most risks are being better dealt with nowadays. Read them to know what you are getting into if you decide to strike your crypto.
If you put your money purely in crypto for the interest, you must keep in mind that the value of the coins you purchase will fluctuate. And especially with the smaller coins, this can be quite significant. Not necessarily just down by the way, because prices can of course also go up!
The advantage of coins that do strike rewards is that there is often a fairly large basis of investors who hold the coins for a longer period of time, so for the interest. This often ensures that the price becomes more stable. Nevertheless, it remains a risk.
Many new coins have been added since the great Bitcoin bull run in 2017. Everyone, read companies with technical knowledge and capabilities, can start their own blockchain and crypto currency. Now many of these have long since disappeared and a small number of them even turned out to be simple fraud cases.
So make sure that you do not just invest in coins, but always read carefully. For example, it also helps to only use reputable and reliable platforms to strike (so choose Bitvavo), and only buy proven and reliable coins. If you come across coins with a story or profit margin that are too good to seem true, they probably are ...
As we explained earlier, blockchains that give staking rewards work with smart contracts. Because you participate in that blockchain with your coins, you ensure that the chain does its job. The condition is that you must make your coins available and they must therefore be available. In other words: accessible. This means there is also an entrance for hackers.
Nowadays, many people get their hairs up when they hear the term hackers, but this risk is really not very great because this is a very complicated process and there is also very strict security, especially if you staked via a good platform such as Bitvavo .
To stake, you have to make your coins available. A precondition for this is that they are in a place where they are accessible. Either your own computer, but in most cases on a third party server. Often not even that of the platform of the broker / exchange, but on the server of yet another.
Those servers themselves have two risks: 1). they can have an error or simply fail. This means that you may not receive a reward or in the worst case even lose your coins. This also applies if you staked from your own computer and your internet fails. 2). The server itself can also be hacked.