Solana has become one of the most famous open source blockchains since it was introduced in 2017 and since then it has held the position consistently in the top 10 digital currencies as per market cap and the staked amount. With that, you may wonder where you can stake Solana. In this article, we will tell you about the top 5 Solana staking platforms that are presently operational.
What Is Solana?
Solana is an open-source blockchain network that has smart contract capabilities that are ideally known for its quick transaction speeds and a broad range of NFT marketplaces and decentralized finance (DeFi) solutions. The blockchain employs PoS (Proof-of-Stake) and PoH (Proof-of-history) to implement smart contracts on the network. Validators are rewarded through an APY (annual percentage yield) which functions exactly like an interest rate. Participants and validators that stake SOL tokens receive rewards.
Can You Stake SOL?
SOL holders can take part in the staking mechanism by contributing their cryptos to a node – either by operating the server themselves or “delegating” their investment to the pool of someone else. By doing this, they are directly participating in the economic security of the network and will get a variable rewards rate.
Solana offers a very competitive staking reward and active space and is among the best choices for earning money through staking. In short, Solana is among the best digital currencies to stake based on the total number locked in that is anticipated at 44 billion at the time of writing. Because of the popularity of staking SOL coins, the variable reward rate of Solana can be lower in comparison to its competitors. Other PoS staking mechanisms like Ethereum and Cardano may offer a better yield in comparison to Solana. With that let us now have a look at the best Solana staking platforms that are presently being operated in the market.
Solana Staking Platforms You Should Know
Centralized digital currency exchanges that provide the provision to stake are ideal for beginners as there are lower barriers to entry in respect of expertise and knowledge. These exchanges are simple to use and remove the requirement to find an ideal validator. In the case of expert investors who prefer to maintain custody of their SOL tokens, Solana wallets like Phantom or Solflare can be employed. Now, these are the best Solana staking platforms where you can earn rewards after staking your SOL.
Binance is by far the most famous digital currency exchange across the globe, with its daily volume frequently dwarfing its competitors by eight-fold. Much of its popularity and success is because of its glut of services that include unique earning chances, an NFT marketplace, and the potential to trade derivatives.
Staking SOL was first incepted to the Binance platform in February 2021, with a primary rewards rate of 43.79 percent APY. This extraordinarily high rate of Solana staking Binance slowly dropped as staking became more famous, however, Binance still provides SOL owners competitive rates and also a low barrier for entry that is ideal for all types of investors.
FTX Exchange is a Solana staking platform that was created by one of the most well-known names in the space, Sam Bankman-Fried. Established in 2019, FTX has become a leading digital currency exchange for futures and spot trading. Not to state the exchange supports a wide spectrum of assets and markets to trade that include the option to stake 4 tokens which also include Solana (SOL).
It should be noted that FTX.US does not enable staking directly, even though it can transfer funds to the FTX application for staking. Non-US users can use the international FTX desktop version or even their application to earn nearly 6 percent APY with FTX Solana staking rewards paid out to the SOL wallet each day. There is an unlocking span of 7 days in which the tokens will not earn rewards. Alternately, SOL tokens can be launched immediately for a 10 percent un-staking fee which would primarily eliminate the staking profits.
While the anticipated APY for Solana is in line with the on-chain staking rewards provided by other platforms, the restrictions with FTX are that the user experience is advanced and not ideal for beginners. However, for experienced investors and traders, the choice to stake Solana on a unified exchange with an abundance of the ecosystem is a benefit.
Kraken is an advanced Solana staking platform that is a famous exchange for USA traders and investors. While the real user interface is dated, it is a secure and reliable exchange for purchasing, trading, selling, and staking crypto. Kraken further added international support for staking Solana in July last year, with an initial APY of 6.5 percent on offer. A benefit of Kraken staking is the simple and easy process to earn rewards on SOL tokens. Once SOL has been transferred or bought, the wallet can be activated by moving to the “Earn” part of the platform, choosing “Staking” and inputting the number of SOL to stake.
Crypto.com has suddenly risen to become one of the most significant apps in the crypto space. From buying the naming rights to the Los Angeles stadium to creating a partnership with sports club Paris Saint-Germain, this platform has soared in stature over the last few years. While the platform primarily functioned as a basic crypto app, it has routinely been adding the latest financial services. Crypto debit cards, NFT marketplaces, and a robust exchange that provides coin staking.
The advantage of staking SOL on Crypto.com Exchange is the convenience of use. Once the soft-staking feature is allowed, assets within the wallet will mechanically start earning staking rewards. Solana rewards are paid out on a regular basis inclusive of Solana tokens availed for pending orders on the exchange that have not been completed. There is a maximum limitation on the amount of Solana that can be staked to receive rewards which are USD 10,000 or USD 100,000 equal in token balance.
Staking Solana on this exchange offers a reward of 1 percent APY or 2 percent which depends on whether the user is also staking the CRO tokens. The higher SOL reward can be unlocked if over 100,000 CRO tokens are staked on the platform. This equates to close to USD 47,000 worth at present prices which are not feasible for novice investors. Along with that, the anticipated reward is less than the on-chain rate. The other drawback is the minimum of 5 SOL to stake.
Huobi Global is a long-running digital currency exchange that was launched in 2013. The exchange has burst in popularity and has offices in the US, Hong Kong, and Japan, and provides services to a broad spectrum of nations.
At first glance, the APY of Huobi for staking SOL is modest, which is close to 3.5 percent APY. For instance, a user who locks up 100 SOL tokens would receive 0.0095 SOL every day subject to volatility in the staking rewards. A point of variation from other soft-staking exchanges is that Huobi offers a link to the validator node which can be checked using Blockchain Explorer that offers complete transparency of delegated tokens within the staking pool. There is also a 5-day un-staking span.
Huobi does offer special offers for a limited time where users can earn free SOL by taking part in community activities. This is among those Solana staking platforms that also roll out infrequent staking promotions through Huobi Earn. These changes sometimes go as high as 50 percent APY, which is an extremely persuasive interest rate. While Huobi may not be the ideal first choice for staking SOL, it is worth investors keeping an eye on their promotions to maximize the ability of SOL earnings.
Solana is among the ideal networks to passively earn on any investment, however, this does not imply that it comes without risks. Stakers have to watch out for slashing which happens when a validator operating a node acts maliciously or does not meet the uptime needs of the network. This results in the validator losing a portion of their rewards, or at times, all of them. If the SOL is offered to a validator who is slashed, the owner may also end up losing some of their investment.
Staking SOL coins on the Solana network is a great way for investors to receive passive income on their assets. Moreover, the SOL token owners can also take part in the ecosystem by helping the development of a fast evolving blockchain. In the above article, we have spoken about the top 5 Solana staking platforms that you can choose if you wish to stake SOL. Other platforms like Solana staking Coinbase are also available but we stated the best ones.