This exclusive guide about the best places to stake Polkadot(DOT) covers all details including fees, security, and ROI.
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, passive income is a very popular concept as well as in traditional finance as in the cryptocurrency markets. Just the idea of earning additional crypto’s on your bags altogether with high yields makes more investors willing to take the step to this new industry.
One concept 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 Polkadot or DOT tokens. Also, a detailed plan to start staking DOT tokens on the different platforms.
What is Polkadot staking?
Polkadot(DOT) is a cryptocurrency with a limited supply of coins. In particular, because of their underlying Nominated Proof-of-Stake architecture, the Polkadot blockchain network allows its users to participate in the network by validating transactions. Moreover, participation is as simple as locking up DOT tokens on several nodes or wallets on the network for a specific time interval. In return for locking up DOT tokens, users are rewarded with additional cryptocurrency.
In other words, no specific technical expertise or confusing tech stuff is needed. You just simply lock up your DOT coins in a wallet and get rewarded while you sleep! 😁
Best Places to Stake Polkadot(DOT)
In short, below is a consolidated list of options where to stake Polkadot(DOT) and get rewarded with the brand new cryptocurrency.
- Binance – Worlds most popular cryptocurrency exchange with almost zero fees
- Kucoin – Cryptocurrency exchange with the most crypto holders on the platform
- Kraken – A good old veteran in the industry that is reliable and also has many accounts on a global scale
- Ledger Nano – The most secure cryptocurrency hardware wallet to store your crypto offline
- imToken – A feature-rich digital wallet to securely manage Polkadot(DOT) and many other digital assets. It enables decentralized value exchange and DApp browsing in one place.
Why Should I Stake Polkadot Cryptocurrency?
As explained earlier staking Polkadot allows you to earn a passive income in cryptocurrency while you sleep. Generally speaking, why should you stake Polkadot(DOT)? This is a good question and in my opinion, Polkadot is one of the most promising blockchain projects in the world, listed as 9th on Coinmarketcap at the time of writing.
On May 26, 2020, was the launch of the genesis block on the Polkadot network. Meaning, on this date the network was officially launched by mining the first block(genesis block) and many more blocks will follow. Despite being a very young blockchain project, it didn’t take long before this network entered the top 10 of all blockchain projects in the world.
Since then, this blockchain project has had massive interest from cryptocurrency investors willing to take part by buying up DOT tokens.
In particular, Polkadot is a very ambitious and promising project that is trying to connect the missing dots that the entire blockchain industry is missing until today. As a result, Polkadot has built an interoperability layer on its blockchain that functions as a bridge between different blockchain networks. All this is in a decentralized manner and it supports scaling up if needed.
Besides, one of the founders of Polkadot is Gavin Wood, a veteran in the crypto industry and one of the famous guys behind the Ethereum project. All in all, a good fundament for a very successful future of this ambitious project.
How does Polkadot staking work?
Above I have given you a glimpse of places to stake Polkadot, however, how does this staking process work?
In general, staking Polkadot can be done in two ways. The first way is quite technical and meant for the real ‘tech-fan boys’ of this project. This way, you have to set up a DOT validator node and you have to deposit a minimum of 350 DOT into this wallet. The best way to do this is on a VPS or some computer at home that can run 24/7 a day.
Notably, it is not easy to become a validator on the Polkadot network and you have to build some trust first. Once you have built that trust nominator nodes on the network will allow you to become a validator. Additionally, your node will have an impact by allowing transactions that occur on the blockchain.
A more easy way Polkadot staking works is by delegating your DOT stash to an existing validator node in the Polkadot network. Moreover, you can just use this way of staking straight from your wallet.
First, you install a Polkadot wallet where you deposit some DOT coins. After that, you have the option to select up to 16 validator nodes. Just choose one of them and start staking right away.
Finally, it is important to know that you have to claim every reward from the validator you chose. Besides, if you don’t do this the reward will go to the validator. Luckily, there is a period of 21 days which gives you some time to claim these rewards.
Best Platforms to stake Polkadot(DOT): Comparison
This comparison guide provides an overview of where to stake Polkadot 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||5.30%||1 DOT||0.08%||Binance trading guide|
|Kraken||12.00%||1.15 DOT||0.16%||Kraken trading guide|
|Kucoin||5 – 14%||1 DOT||0.10%||Kucoin trading guide|
|Ledger Nano||14.00%||1 DOT||1.7 – 4.5%||Ledger live guide|
Staking Polkadot at Cryptocurrency Exchanges
If you already have an account at Binance or Kraken.com, then the easiest way would be to start staking Polkadot there. Below I’ll explain the exchanges for staking Polkadot(DOT) in more detail.
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 😄
In particular, Binance offers 25 staking products such as Polkadot for its users to enjoy free staking rewards by simply depositing and holding coins on Binance. Moreover, there are no fees to stake DOT tokens on Binance. Additionally, staking DOT starts from 1 DOT to a maximum of 10,000,000 DOT per account. All profits earned are shared with Binance users to maximize staking rewards.
The benefit of staking Polkadot on Binance is that cryptocurrency traders can opt to stake DOT while waiting for a trade. Traders can benefit from the staking rewards in addition to potential trade profit.
Steps to start staking Polkadot at Binance
To start with staking Polkadot(DOT) at Binance follow these steps:
- Create a free account at Binance
- Navigate at ‘Finance’ at the top menu and choose ‘Binance Earn’
- Find Polkadot in the Flexible Staking list(you have to scroll down a bit)
- If you don’t have DOT funds in your wallet ‘market buy’ some or deposit
- Click ‘Transfer’ button and store DOT tokens here
Kraken is one of the most reliable and safest cryptocurrency exchanges out there and has been around for a while already. Founded in 2011, Kraken is a US-based cryptocurrency trading platform available in 48 US states and 176 countries. Also, because of its safe reputation, the exchange data is being used as a ticker(BTC/USD) on the Bloomberg terminal.
The Kraken platform specializes in offering Bitcoin trading services for the beginner as well as the professional trader. Besides trading in digital assets, it’s also possible to store your crypto in custodian wallets, crypto lending services, and staking cryptocurrencies.
Spot trading crypto(Bitcoin for example) gives you a fee of 0.16% and this value decreases when USD volume rises. Additionally, margin trading is even cheaper where the rate is set to 0.01%.
Staking crypto-like Polkadot can be done at Kraken in 3 different cryptocurrencies(XTZ, ATOM, and DOT). The way this works is very simple and straightforward: buy the cryptocurrency you want to stake and transfer it to the staking wallet on the exchange.
Steps to start staking Polkadot(DOT) on Kraken
To start with staking Polkadot(DOT) at Kraken, follow these steps:
- Create a free account at Kraken
- If you don’t own DOT tokens, you can market buy them at the exchange,
- Otherwise, just deposit your DOT tokens under ‘Accounts’ and then ‘Spot’
- Navigate to ‘Staking’ in the upper menu
- Choose Polkadot and click ‘Stake’
- Staking should be starting instantly
Compared with the crypto exchanges 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 specializes 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 Polkadot(DOT) on Kucoin
- Create a free account at Kucoin
- If you don’t own DOT tokens, you can market buy them at the exchange,
- Otherwise, just deposit your DOT tokens under ‘Main Account(deposit and withdraw)’
- Navigate to ‘Earn’ in the upper menu and then ‘Soft staking’
- Find DOT and choose ‘Deposit’ or if you have DOT tokens already then just click ‘Transfer’
- Staking should be starting instantly
Staking Polkadot(DOT) from Wallets
Next, a list of two wallets that allow you to stake Polkadot without leaving the coins at a third-party platform like a centralized cryptocurrency exchange. Also, these places to stake Polkadot 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 Polkadot on Ledger Nano
- First, install the firmware of the Ledger Nano device
- Start installing the Polkadot App by opening the ‘Manager’ on Ledger
- Connect and unlock the Ledger device
- Allow the Manager on your device
- Find Polkadot and click ‘Install’
- Wait and run the installer
- Continue the installation by reading this guide on the Polkadot website
imToken is a feature-rich digital wallet to securely manage BTC, ETH, ATOM, EOS, TRX, CKB, BCH, LTC, and other digital assets. It enables decentralized value exchange and DApp browsing in one place.
Besides staking from the wallet, users can also manage their crypto assets and exchange or swap different tokens. Also, the wallet is very secure where you can keep your private key on the device.
In general, the imToken software wallet is very simple to use when you are mostly on a mobile phone. Therefore, many people favor this wallet as an option where to stake DOT or other cryptocurrency coins.
How to start Staking Polkadot on imToken Wallet
- Download the imToken Polkadot wallet here
- Deposit DOT tokens here
- Check transaction history if needed
- Click stake/bond
Is staking Polkadot worth it?
Staking Polkadot is currently a very popular method among crypto enthusiasts to generate passive DOT income with zero risks. In this guide in which I covered where to stake Polkadot in greater detail, I also compared the different platforms in terms of rewards and lock-up periods.
Additionally, the idea of staking Polkadot(DOT) is simple where every single DOT token will generate new ones. Moreover, Polkadot or the DOT 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 DOT is a perfect solution for you to earn additional cryptocurrency while you sleep.
When staking from a custom wallet like imToken or Ledger make sure that you know what your doing when choosing validators. Moreover, make sure that the wallet-address that will receive the staking rewards hold at least 1 DOT. Rewards sent to an empty wallet-address will be lost forever.
Unfortunately not. At this moment in time Coinbase only allows to buy and sell DOT tokens, however, this could change in the not so distant future.
It depends on which platform or what kind of wallet you are planning to stake. On average the validator pools can give you 10% APY. However, Kraken is an exception as their pool gets 14% and they are willing to give you 12%. Additionally the other 2% they hold as a fee.
The main risk when staking Polkadot comes by delegating your tokens from within your wallet. If your (chosen) delegator is secretly trying to ‘trick’ the system the blockchain network will punish it. Additionally this is called slashing where a percentage of your DOT stash will be lost.
The most easiest way to start staking Polkadot is on the major trading platforms out there: Binance, Kraken or Kucoin to name a few. Another option is to stake Polkadot using wallets where Ledger and imToken are the most reliable ones.
The following articles might also be a good read for you:
- How To Buy Polkadot On Binance(In 5 steps)
- Approved: Best Places To Stake Cardano(ADA)
- What are the Best Coins to Stake in Cryptocurrency(in 2021)
- 7 Best Exchanges to Buy Polkadot(DOT)
- Best Ways To Invest in Polkastarter(POLS) Token
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