Compare Crypto Staking Rewards: Find the Highest Crypto Returns
Crypto staking has become a popular way to earn passive income.
In 2020 prominent crypto platforms such as Coinbase and Binance started offering crypto staking services to their customers in a simple straightforward manner, eradicating risky and complicated staking methods.
Nowadays, almost every crypto platform offers crypto staking. Increased competition to attract users often results in platforms devising exciting promotions that yield highly attractive returns on certain crypto projects.
The table below helps you to identify the best crypto-staking rewards from trusted platforms.
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You may compare the annualized yields on staking and savings products, which is valuable to investors who are seeking to maximise the returns on their existing crypto portfolio.
Whitepapers are also included (whenever possible) for each project to facilitate your education and research.
💡 Crypto staking is a powerful governance mechanism. Read our freecrypto staking guide to learn more about what it is really all about.
Table Disclaimer ⚠️ The data in our tables are updated periodically and should be used for indicative purposes only. The source data, terms and information in our tables may change without notice so please check directly with the relevant platform first before making any decisions.
🔎 If you’re looking for a more focused analysis on Bitcoin then visit our bitcoin savings page.
Frequently Asked Questions
✅ What is crypto staking?
Staking is the process of keeping funds in a cryptocurrency wallet (or staking pool) to help the underlying proof-of-stake blockchain network operate more efficiently and securely.
But let’s break it down by starting from the first principle. In the English dictionary, the word “stake” is used in the context of “supporting” – think of the word “stakeholders” which refers to all participants supporting a particular entity (shareholders, customers, employees, etc) to grow and prosper. In the context of cryptocurrency, the term “staking” has the same meaning. Its crypto origins come from the term proof-of-stake, which is a consensus algorithm that is supported by a cluster of nodes that purchase astake (through buying pre-mined tokens) in a particular network. The point here is that nodes play an important stakeholder role by supporting the growth and prosperity of a particular network. If you want to explore this topic further, read our comprehensive staking guide.
✅ Why was Proof of Stake (PoS) developed?
The Proof of Stake (PoS) consensus mechanism was born in 2011 as a way to use far less energy than Proof of Work (PoW) to validate transactions on the blockchain.
✅ Proof of Work vs Proof of Stake: what’s the difference?
In Proof of Work (PoW), miners with specialized hardware ASICs try to solve complex cryptographic problems in order to receive the block reward + transaction fee as an incentive for solving a puzzle. However, solving these increasingly difficult mathematical puzzles is extremely energy-intensive.
With Proof of Stake (PoS), no mining is required to solve complex mathematical puzzles to validate transactions, and therefore the process is significantly less energy-intensive.
In Proofof Stake mechanisms, new blocks are created through a process known as ‘forging‘ or ‘minting‘ (not ‘mining’) through a pseudo-random selection process. Unlike Proof of Work systems whereby a miner is awarded a block reward plus the transaction fees, in a Proofof Stake system the chosen node that helps to protect and run the network is rewarded with only the transaction fees.
✅ How does the Proof of Stake (PoS) mechanism work?
Essentially, in a Proof of Stake consensus mechanism, nodes participating in the forging process of a particular blockchain network will be required to purchase pre-mined tokens (locking a certain amount of tokens) as a stake.The nodes that are successful at validating a transaction are selected through a pseudo-random process that is based on numerous factors such as the size of the stake. This means a bigger stake has a higher probability of being selected to validate a transaction (and earning the transaction fee) although newer staking mechanisms are adding a greater weighting to other factors such as node age, wealth, and specific behaviors to ensure nodes are always acting in the best interest of the network.
✅ What are crypto staking rewards?
Staking rewards are the tokens that are received (as an incentive) for helping to protect and support a blockchain network that is governed by a Proofof Stake consensus mechanism. These tokens are actually a proportion of the newly minted tokens in the network. The value of these freshly minted tokens is essentially derived through the interplay of supply and demand of the network’s listed token on a cryptocurrency exchange.
✅ How does crypto staking inflation work?
When a Proofof Stake network issues new tokens to compensate nodes for protecting the network, the new supply of tokens dilutes their relative ownership/participation in the network. Many refer to this as the stakinginflation rate but what’s really happening here (all else equal) is dilution.
Unless a node is maintaining its stake in the network, all else equal, a constant increase of new token supply will dilute a node’s stake in the network. This, in turn, lowers the probability of being selected to validate the next transaction (and therefore earn the transaction fees) and also dilutes the price of all the tokens traded on the secondary market. This is why it is important to compare the annual inflation rate together with the annual yield or APR (annual percentage rate) for staking rewards.
✅ How do you calculate the inflation /dilution rate?
Simply divide the number of newly minted tokens (expected in a year) by the total supply of tokens at the beginning of the year.
✅ Crypto staking vs crypto savings: which is better?
When you look under the bonnet, crypto staking and savings are very different.
With a cryptocurrency savings account, you are effectively receiving a form of ‘crypto interest’, very similar to how a bank savings account operates. The savings account provider loans out your cryptocurrency to borrowers, who are trading crypto using leverage, and provides you with a proportion of “crypto interest” in return.
On the other hand, with crypto staking, you are receiving a staking reward (freshly minted tokens) as an incentive for participating in the network.
In the past, there was a view that crypto staking is safer than crypto savings accounts due to implications around private key ownership although in reality savings accounts have withstood the test of time and are equally as safe and reliable, as long as you are using a trustworthy provider of course.
In general, crypto saving accounts tend to have more attractive annualised yields on stablecoins and bitcoin whereas crypto staking tends to have better annualised yields on altcoins. However, those discrepancies are slowly fading away as the market becomes increasingly more competitive.
✅ What does APY mean?
APY stands for ‘Annual Percentage Yield’. It is the rate of return earned on an investment over a period of one year after taking into account the effect of compound interest. The more often interest is compounded, the higher the APY will be.
✅ What is APR?
APR stands for ‘Annual Percentage Rate’. It is the rate of return earned on an investment over a period of one year not factoring in the effect of compound interest.
✅ What is the difference between APR and APY?
The difference between the two annual returns is that APY takes compounding interest into account while APR does not. Simply put, APY refers to the compounding effect. This means that acquired interest rates contribute to the calculation of the next interest rate, and so on.