Where to stake Algorand(ALGO) tokens and earn passive income? In this guide an exclusive view on the best places to stake Algorand crypto!
Since the introduction of Bitcoin and also many other cryptocurrencies, this market has witnessed massive growth and is ready for entering a maturity phase. Therefore many new ideas and concepts are being introduced that offer investors some good profits.
In particular, the Ethereum blockchain introduced a new way for investors to earn a passive income by holding coins. Moreover, this is a very popular concept that attracts a lot of new investors trying to be profitable in the cryptocurrency markets. Imagine, just the idea of earning additional crypto’s on your bags altogether with high yields makes them willing to take the step to this new industry.
The concept I’m talking about is called staking which in short allows cryptocurrency holders to earn additional cryptocurrency with low risk.
In this guide, I’m going to discuss the best places to stake Algorand or ALGO tokens. Also, a detailed plan to start staking ALGO tokens on the different platforms.
What is Algorand Staking?
Algorand(ALGO) is a cryptocurrency with a limited supply of coins. In particular, because of their underlying Pure Proof-Of-Stake consensus mechanism, the Algorand blockchain network allows its users to participate in the network by validating transactions. Moreover, participation is as simple as locking up ALGO coins on several nodes or wallets on the network for a specific time interval. In return for locking up ALGO tokens, users are rewarded with additional cryptocurrency.
In other words, no specific technical expertise or investment in costly hardware devices is needed. You just simply lock up your ALGO coins in a wallet and get rewarded while you sleep! 😆
Best Places To Stake Algorand(ALGO)
In short, below is a consolidated list of options where to stake Algorand(ALGO) and get rewarded with the brand new cryptocurrency.
- Binance(Best option for beginners 👶).
- Kucoin(Best option for US residents 🇺🇸).
- Bitfinex(Best option if you are an ALGO whale 🐋).
- Ledger Nano(Best option for offline staking 🔐).
- Exodus Wallet(Best option to stake from your desktop pc 🖥️)
How Does Algorand staking work?
In contrary to the older blockchain networks like Bitcoin or Litecoin, the Algorand network uses a different technology which is called Proof-Of-Stake. For instance, the Bitcoin network relies on miners to validate transactions whereas Algorand or any other PoS network relies on validators to verify transactions on-chain.
Particularly, Algorand chooses its validators using a process called sortition with a selection preference towards validators(nodes on the network) holding the largest amount of tokens, referred to as stake. Just like miners on the Bitcoin network, the validators receive rewards for their work, but unlike PoW, no resources are wasted on unnecessary, competing for work.
The rewards are typically a percentage yield of return on the amount of stake a validator is holding. That way, the economic incentives for validators are directly linked to the amount of stake as a motive for supporting the network i.e. the higher your stake, the more interest you have in contributing to the health of the network, and the more rewards you earn.
How are rewards being distributed?
At the time of writing, there are 26 Algo tokens being distributed as network rewards in each block being validated, approximately every 4.4 seconds.
Algorand rewards are calculated for each block based on the account balance of every to-or-from address recorded on the blockchain. The minimum account balance that is eligible for receiving rewards is currently 1 Algo.
In other words, you are rewarded with 1 microAlgo for every single Algo token you hold in a wallet for every 42 rounds or roughly every 3 minutes. This will obviously change as the total supply grows.
Can You Stake Algorand on Coinbase?
Yes, it’s possible to stake Algorand on Coinbase. Additionally, in December 2020 the Coinbase platform allowed its users to stake ALGO tokens from their wallets. If you are a US resident, this is the shortest route to acquire ALGO tokens and start earning(approximately 6%) on them.
To get started on Coinbase, add Algorand to your account with a purchase or transfer. Your first Algorand reward should then appear in your account tomorrow. After that, you’ll earn rewards daily.
Best Platforms to Stake Algorand(ALGO): Comparison
This comparison guide provides an overview of where to stake Algorand to earn rewards and a passive income. The research is based on assessing the platform’s features, estimated annual yield, fees for buying crypto, and security.
|Platform||Estimated ROI||Minimum holdings||Fees||Rating||Guides|
|Binance||1 – 17%||100 ALGO||0.08%||Binance trading guide|
|Kucoin||5 – 7%||5 ALGO||0.10%||Kucoin trading guide|
|Bitfinex||5.00%||1 ALGO||0.10%||Bitfinex trading guide|
|Ledger Nano||5 – 6%||1 ALGO||1.7 – 4.5%||Ledger Live guide|
Staking Algorand at Cryptocurrency Exchanges
If you already have an account at Binance or any other reliable exchange, then the easiest way would be to start staking Algorand there. Below I’ll explain the exchanges for staking Algorand(ALGO) in more detail.
Binance: Best option for beginners
Based on daily(24h) trading volumes, Binance is the biggest cryptocurrency exchange in the world. Also, it has millions of cryptocurrency traders using its platform on a daily basis. Besides trading, Binance offers several other feature-rich products, including custodian wallets, crypto margin trading, lending service, and earning rewards with staking.
|If you want to know more about the difference between staking and crypto lending. Read the article we wrote about crypto lending vs staking. It explains very clear two very popular passive income strategies in the crypto industry.|
Trading a Binance can be done with almost zero fees(0.03%) if you use this link when signing up. It will give you a 20% discount on fees for life 🙂
At the time of writing, Binance offers 25 staking products such as Algorand for its users to enjoy free staking rewards by simply depositing and holding coins on Binance. Moreover, there are no fees to stake ALGO tokens on Binance.
Additionally, you can lock up your ALGO tokens for several periods starting with 7 days which will give an APY of 1%. Of course, if you want higher profits you can lock up for a longer period(see below).
POS staking ALGO on Binance
The benefit of staking Algorand on Binance is that cryptocurrency traders can opt to stake ALGO while waiting for a trade. Traders can benefit from the staking rewards in addition to potential trade profit.
Steps to start staking Algorand on Binance
To start with staking Algorand(ALGO) at Binance, follow these steps:
- Create a free account at Binance
- Navigate at ‘Finance’ at the top menu and choose ‘Binance Earn’
- Find ALGO in the Flexible Staking list(you have to scroll down a bit)
- If you don’t have ALGO funds in your wallet ‘market buy’ some or deposit
- Click ‘Transfer’ button and store ALGO tokens here
Kucoin: Best option for US residents
Compared with Binance described above, Kucoin is probably a modern platform for trading any cryptocurrency. In addition, this platform was founded by a group of cryptocurrency enthusiasts from Asia aiming to offer comfort and security to your mighty assets.
As of writing the platform ranks at position 12 on the list of exchanges which is based on trading volume for the past 24 hours. In addition, the platform is specialized in offering trading cryptocurrencies, margin trading, trading futures, and also staking cryptos.
Spot trading cryptos can be done at a fee of 0.1% and it is also important to note that withdrawals from the platform can be done at zero fees.
Staking cryptocurrencies is also possible under the ‘soft staking’ feature. Moreover, Kucoin allows its users to stake in 32 different cryptocurrencies.
Steps to start staking Algorand on Kucoin
- Create a free account at Kucoin
- If you don’t own ALGO coins, you can market buy them at the exchange
- Otherwise, just deposit your ALGO tokens under ‘Main Account(deposit and withdraw)’
- Navigate to ‘Earn’ in the upper menu and then ‘Soft staking’
- Find ALGO in the sliding list gallery and choose ‘Deposit’
- Or if you already have ALGO in the Main account choose ‘Transfer’
- Staking ALGO should be starting instantly
Bitfinex: Best option for ALGO whales
Bitfinex is one of the oldest cryptocurrency exchanges in the world. The platform was created back in 2012 and since that moment it has been offering trading services to users. The exchange started as a P2P margin and lending platform for Bitcoin (BTC).
Over time, the company decided to add support to other digital assets. Moreover, it is now offering services to 52 different countries and it also allows users to deposit fiat currencies. The firm is headquartered in Hong Kong and it offers trading solutions in different languages, including English, Russian, and Chinese.
Trading on this exchange is a very smooth and reliable experience mainly because of the very high trading volumes. Also, spot trading crypto(Bitcoin for example) gives you a fee of 0.1%.
Staking Algorand and many other cryptocurrencies is one of the options you have when you are planning to use this platform.
Steps to start staking Algorand on Bitfinex
- Create a free account at Bitfinex
- If you don’t own ALGO coins, you can market buy them at the exchange
- Otherwise, just deposit your ALGO coins to the Exchange account
- Just hold the tokens in the Exchange account and get weekly rewards
Staking Algorand(ALGO) from Wallets
Next, a list of two wallets that allow you to stake Algorand without leaving the coins at a third-party platform like a centralized cryptocurrency exchange. Also, these places to stake Algorand give you full control over your cryptos.
Ledger Nano hardware wallet
If you favor being in full control of your own cryptos then the Ledger Nano hardware wallet should be it. Particularly, the Ledger Nano wallet is a USB storage wallet with Bluetooth connectivity available.
Also, this way it’s possible to store your cryptocurrencies offline which is the most secure option. Furthermore, the wallet enables users to perform a wide variety of functions, including sending and receiving bitcoin from blockchains or running third-party apps on the device.
Besides staking from the wallet, users can also purchase new crypto because of Ledger wallet uses a built-in exchange feature. This feature uses a third party(Coinify) so buying comes at a cost: 4.5% credit card fees or 1.7% for bank transfers.
How to start staking Algorand on Ledger Nano
- First, install the firmware of the Ledger Nano device
- Start installing the Algorand App by opening the ‘Manager’ on Ledger
- Connect and unlock the Ledger device
- Now deposit at least one ALGO
- Staking will start immediately
|⚠️ Warning: Always make sure to buy your Ledger Nano devices from the official online store. In fact, third-party sellers have been known to tamper with Ledgers.|
This wallet has been there for a while and has a proven track record of being very secure. Therefore, the Exodus Wallet allows you to store your crypto offline(with Trezor) and when needed, connect with their software wallet app.
Another interesting feature of Exodus is the number of cryptocurrencies(130) that can be stored in the app and offline.
Staking is also a feature of this wallet where currently 6 different cryptocurrencies are supported: ALGO, ATOM, ONT/ONG, NEO/GAS, XTZ, and VET/VTHO.
How to start staking Algorand(ALGO) on Exodus Wallet
The process of staking Algorand on Exodus wallet is very simple:
- Visit the Exodus Wallet website, start downloading and install the app
- Deposit ALGO or purchase it with the built-in exchange
- Once deposited, staking ALGO will start automatically
Conclusion: Is staking Algorand worth it?
Staking Algorand is currently a very popular method among crypto enthusiasts to generate passive ALGO income with zero risks. In this guide in which I covered where to stake Algorand in greater detail, I also compared the different platforms in terms of rewards and lock-up periods.
Additionally, the idea of staking Algorand(ALGO) is simple where every single ALGO token will generate new ones. Moreover, Algorand or the ALGO token is a rising asset in terms of value where even holding a small amount can make a difference in the long run.
All in all, staking ALGO is a perfect solution for you to earn additional cryptocurrency while you sleep.
You can stake ALGO on Coinbase. Staking cryptocurrency is a great way to earn rewards while contributing to the success and security of a blockchain
Yes, it certainly is possible. The best and most easy way to do this is to deposit some ALGO tokens there. Additionally, the Algorand wallet on Trust will start staking automatically.
Algorand and it’s token ALGO are a on a blockchain network with a limited total supply of coins(10,000,000,000). Therefore, earning staking rewards won’t last forever but this can take many years from now. At the moment you can earn participation rewards by just holding ALGO tokens. However, somewhere in 2022 this participation model will be replaced by the Governance Rewards system.
When staking directly on Algorand blockchain or wallet no action is required to start staking. You only need a minimum balance of 1 ALGO. Once claimed, your rewards are directly added to your global balance. Staking Algorand on crypto platforms like Binance, Kraken or Kucoin requires different minimum balances.
In the Algorand blockchain, users automatically generate Staking Rewards (also referred to as Participation Rewards) by simply holding Algos in their balance. Meaning, if you are holding Algorand(ALGO) in a wallet you automatically will receive rewards. However, it’s important to know that staking on platforms like Binance or Kucoin different rules apply.
The following articles might also be a good read for you:
- What are the Benefits of Binance Trading Platform?
- Top 5 Do’s and Dont’s of Cryptocurrency Wallets
- What are the Best Coins to Stake in Cryptocurrency(in 2021)
- Confidential: Best places to keep my Crypto Safe
- Approved: Best Places To Stake Cardano(ADA)
📣Important: List of top Crypto Projects
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