ada
Cardano$0.475279*
*prices delayed up to 10 minutes-0.52%
24HDisclosure: eToro USA LLC; Investments are subject to market risk, including the possible loss of principal.
Cardano has introduced itself to top decentralized finance (DeFi) projects like Bitcoin and Ethereum, currently sitting at the 7th largest cryptocurrency by market cap. However, at one point it was the 3rd largest right behind Bitcoin and Ethereum. Cardano is a proof-of-stake blockchain platform that aims to “redistribute power from unaccountable structures to individuals.” Currently, Cardano’s value is widely speculated — its smart contract ecosystem has yet to be built out.
Here’s a look at where to earn interest on your Cardano as well as how to go about that process.
How Does Earning Interest on Crypto Work?
Earning interest on crypto is similar to earning interest on fiat. When a user holds their crypto on an exchange it provides liquidity for the platform. Users are then rewarded with crypto in the form of an annual interest rate, known as a process called staking. By staking Cardano, users are participating in the security and governance of the Cardano blockchain network by validating smart contracts.
Binance Overview: 7% APR on ADA
Binance is a cryptocurrency exchange that allows users to buy, sell and store their crypto. Binance also offers a variety of staking pools, which allow users to earn interest on crypto they have stored in their Binance wallet. The staking process operates on a first-come, first-served basis, with crypto interest paid out daily.
Binance offers a few different options when it comes to staking, and has the highest interest rate (with a catch). You can lock in a fixed rate of up to 7% when locked in for a fixed term of 60 days. There is also a flexible option of just 0.48% APY for traders who wish to accumulate small rewards, while still being able to trade Cardano.
Other Options for Earning Interest on Cardano
A solid option with no lock up times is Nexo. Nexo.io offers just over 6% APR on ADA tokens staked on their platform. Plus, the platform has much better reviews and is more trusted among cryptocurrency investors.
Other exchanges offer their own interest rates for staking on their platform. Crypto.com for example offers a 2% to 3% fixed-rate option. Determine which rates work best for you before staking your cryptocurrency.
How to Earn Interest on Cardano
Earning interest on Cardano is not much different than earning interest on other cryptocurrencies. When you’ve settled on where to buy your Cardano, follow these easy steps to start passively earning Cardano.
Step 1: Open an online account.
The first step to earning interest on Cardano is opening an account with your exchange of preference. For this example, it’s best to use Nexo, as the platform offers a high interest rate without lock up times. Plus, assets on Nexo are insured, adding a level of security to your investment. Make sure your password is strong and secure; this will minimize the chances of your account being compromised.
Step 2: Purchase cryptocurrency.
The next step is actually purchasing Cardano using the exchange you signed up for. This can be done by simply adding a debit card of your choice and making a one-time payment. There is also an option for recurring purchases if users are looking to accumulate more Cardano. Once you have purchased your Cardano you can now start the staking process.
Step 3: Earn interest on your crypto.
When the desired amount of Cardano is in your account, you are now able to begin staking. Nexo pays out interest on a daily basis, letting your digital assets compound to earn you high interest rates. Plus, there’s no fees on withdrawals on the platform.
Other Platforms to Earn Interest on Cardano
Crypto.com is a digital asset service that allows users to buy, sell, trade and stake their cryptocurrency through their beginner-friendly crypto app. The app supports a list of 30 different coins that can be staked on the platform, including Cardano, where users are able to earn 3% when locked into a fixed term of 3 months. Although Crypto.com may not offer the highest staking rewards, staking can be increased to 5% for a fixed 3-month period by holding 500,000 CRO tokens in their wallet.
Risks of Earning Interest on Crypto
When dealing with cryptocurrencies, there are always going to be risks involved. One of the main things to be aware of is when staking, the centralized exchange now has control over your crypto. Users wishing to trade that crypto are unable to until the fixed term is done. There is also a large volatility risk when dealing with crypto. If you buy crypto then stake it, and the price goes down, you will end up losing more money than you’ll make with the interest of staking.
Cryptocurrency is a highly volatile market. Make sure to do your own research before staking, and never invest more than you can afford to lose. If you’re budgeting and doing your research, you’ll be far more prepared to make the appropriate investments.
At the same time, you may be bullish on crypto and expecting it to rise in time, but there’s no way to know how much crypto could rise in the future. This, in and of itself, is a risk.
Is Earning Interest on Cryptocurrency Worth It?
Depending on what you want to do with your Cardano, earning interest on it may be beneficial. If you plan to actively trade your Cardano, staking may not be the best option. To earn rewards on Cardano that you do not actively trade, staking may be a great choice. Always make sure to do your own research to find which staking option best works for you.
Frequently Asked Questions
Whats the average rate for staking Cardano?
The average rate for staking Cardano is about 6%
Is it worth it to stake Cardano (ADA)?
f you plan on holding on to your Cardano (ADA) longterm, then staking is definitely worth it to earn some extra interest on your cash already being held.
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