Staking is a simple and easy way to earn passive rewards on your current crypto holding.
Understanding how to stake crypto safely and easily is key to maximizing your returns.
The process of crypto staking comes with its own financial risks and security issues.
With the right information and proper security measures in place, staking can become a simple and reliable way to earn rewards and passive income.
Crypto adoption has seen a stellar growth in recent times. People across age groups, professions, industry verticals, cultures and ethnicities are investing and using cryptocurrency on a daily basis.
Blockchain technology has also ushered in a new era of several new financial instruments that are opening up new opportunities for investment, growth, and remittance.
Amongst them all, Staking is one of the most sought after methods to multiply your crypto. While crypto staking can be very easy to learn and implement, a vast majority of the crypto users do not know how to stake crypto safely.
Having the right knowledge about staking is key to keeping your funds secure while earning rewards from various stakable cryptocurrencies.
While this article elaborates on Crypto Staking for Beginners, let us also look at some other popular blockchain based financial instruments:
De-Fi offers investment options like yield farming, liquidity mining staking & lending/borrowing.
On-chain transaction services like remittance and cross-border transfers at a fraction of a cost in comparison to the SWIFT network.
Tokenised Assets facilitate the representation of real world assets like art, real estate and commodities as digital tokens, hence enabling fractional ownership and trading with ease.
Crypto Bonds are debt instruments that are issue on a blockchain that are programmable, transparent and settled in real-time.
Crypto ETF’s (Exchange traded Funds) are alternative investment funds that track crypto assets like Bitcoin or Ethereum.
NFT’s are unique digital assets representing ownership of art, music, collectibles, and even in-game items. They are digital equivalents that retain the ownership of the creator despite being sold and bought.
What is crypto staking?
Crypto staking is a popular way to earn passive income by locking your coins in a blockchain network and receiving staking rewards in return.
This is comparable to traditional banking, where customers earn interest on their deposits over a fixed period of time. Staking crypto is especially beneficial for those who plan to park their cryptocurrency assets long-term. It’s a simple and popular way to grow your crypto while holding.
Why should you stake your crypto holdings?
Earn Rewards and Support Blockchain Projects:Staking lets you earn rewards while helping secure and validate blockchain networks, enhancing their credibility and efficiency.
Eco-friendly alternative to crypto mining: Unlike energy-intensive Proof of Work crypto mining, Proof of Stake is more eco-friendly, enabling faster, cheaper transactions with lower computing demands.
Types of Staking
Self-Staking:
By becoming a Validator Node on a blockchain, one can self-stake their tokens.
While this method offers higher staking rewards, running a validator node requires blockchain technical expertise and dedicated 24/7 infrastructure.
Delegated Staking:
This method of staking involves delegating tokens to an existing blockchain validator node.
Easy and suitable for most users.
Staking services on Exchanges
Crypto exchanges like Coinbase, Binance and others offer staking as service.
Very user-friendly, but exchanges may charge higher service fees
Staking-as-a-Service Platforms
– Staking service providers like Lido, Rocket Pool and Everstake offer
both custodial and non-custodial options.
Crypto Staking Guide for Beginners
Choosing a cryptocurrency that is stackable:
Some of the stakable cryptocurrencies include:
Ethereum (ETH)
Solana (SOL)
Cardano (ADA)
Polkadot (DOT)
Tezos (XTZ)
You can also research other cryptocurrencies based on the Staking Market Capitalisation.
Choose a Staking Method:
Directly via your wallet
Staking services through an exchange
Using a staking-as-a-service platform
Ethereum blockchain staking offers self staking, staking as service and Pooled Staking. Compare them to understand what works best for you.
Choose a Crypto wallet that support Staking:
For self-staking or delegated staking, use a wallet that supports staking:
Some example of crypto wallets available on various blockchains:
Solana : Phantom, Solflare
Cardano : Daedalus, Yoroi
Ethereum : MetaMask + Lido/Rocket Pool
(Lean more about crypto wallets through another article on CoinRank)
Track your Staking stats:
Reward rates
Validator Node performance
Lock-up periods
Risks of Staking
Slashing
Certain blockchain networks penalise validators for downtime or malicious activity, which can lead to a partial loss of staked funds. Validator nodes are compromised due to security breaches like Sybil attacks, 51% attacks, or other forms of node compromise.
Mitigation: Choose reputable validators who implement the latest cybersecurity practices and offer high uptime and performance records.
Custodial Risk and service disruption
While staking with centralized exchanges or custodial services, all the staked funds are held within their custody. In case of a cybersecurity breach, there is a possibility of loss of funds and disruption of services
Mitigation: Use non-custodial staking when possible or stick to regulated, trustworthy platforms.
Lock-up Periods
Some staking services require you to lock your funds for a stipulated period of time.
Mitigation: It is important to understand the lock-up period before staking and keep liquidity needs in mind.
Volatility
Since Cryptocurrency values are algorithmically derived, they are extremely volatile. This can result in fund loss in the event of a market crash.
Mitigation: Diversify your staked assets and stake projects with strong fundamentals.
Best Practices to follow for Safe and Easy Staking
Use Hardware Wallets :
Software and app based wallets, also known as hot wallets (Metamask, Coinbase, Kraken etc) are always connected to the internet and are susceptible to cybersecurity attacks.
Source: www.ledger.com
Hardware wallets also known as Cold Wallets, are physical devices that are plugged into the internet while transacting only. Hence, making them safer to use and less prone to cybersecurity attacks. Some hardware wallet brands are Ledger, SafePal and Tangem
Verify and research validators and staking platforms
One must research and verify the market reputation, legitimacy and security of staking services. Popular and known validators employ the best cybersecurity practices, compliance with local law and financial regulations.
Avoid High APY Scams
Users must be aware of lucrative staking services that offer high gains over a short lock-up period. Staking is usually not a short term rewards investment.
Staying current on network updates and staking protocols
Blockchains are always evolving and are constantly updated to keep up with technological challenges. These improvements include – higher transaction processing capacities, lower gas fees, improved security, efficient consensus and validation algorithms and the likes.
By staying updated about these changes, users can benefit from the latest updates and staking percentages.
Use Reputable Platforms
By sticking to well-known services, users can rest easy with their investments. Non-compliance with crypto financial laws and compliance may result in loss of funds or cause issues with local law enforcement.
Final Thoughts
Staking is one of the easiest ways to put your crypto to work, earning passive income while contributing to blockchain security. Whether you choose a simple exchange-based solution or delegate through a wallet, the key to staking safely lies in understanding the process, researching your options, and managing your risk.
By following the right steps and best practices, you can stake crypto confidently and efficiently—without needing to be a blockchain expert.
Frequently Asked Questions (FAQs)
1. What is crypto staking?
Staking is locking up your crypto to help run a blockchain network in exchange for rewards—similar to earning interest in a bank.
2. Is staking safe?
Staking is generally safe but carries risks like validator penalties, custodial loss, token volatility, and lock-up periods. Use trusted platforms and secure wallets to reduce risk.
3. How do I start staking?
Pick a stakable crypto (e.g. ETH, SOL, ADA)
Choose a staking method (self, delegated, exchange, or staking platform)
Use a compatible wallet
Stake and earn rewards
4. Do I need technical skills?
Not if you use delegated staking, exchanges, or staking platforms. Running your own validator does require technical knowledge.
5. How much can I earn from staking?
Rewards vary by token and method, typically 4–20% annually. Be cautious of extremely high APY offers—they may be scams.
6. Can I lose money staking?
Yes. Losses can result from slashing, platform hacks, price drops, or liquidity issues. Always do your research and manage risk.
7. What’s the difference between custodial and non-custodial staking?
Custodial: Your crypto is held by a third party (e.g. exchanges)
Non-custodial: You control your assets via private wallets
8. Which wallets support staking?
Examples include:
Solana: Phantom, Solflare
Cardano: Daedalus, Yoroi
Ethereum: MetaMask (with Lido or Rocket Pool)
9. Can I unstake anytime?
Some networks require a lock-up period. Others offer more flexibility through liquid staking—read the terms carefully.
〈How to Stake Cryptocurrency Safely and Easily – A Quick Guide〉這篇文章最早發佈於《CoinRank》。
