Introduction:
Crypto Staking is an alternative way of earning passive income from your cryptocurrency. So many cryptocurrencies have added the staking option, and one of them is Anchor Protocol. You can earn passive income from your Anchor protocol in many ways, like being a depositor, a borrower, or when you stake Anchor Protocol.
By staking, the general security of the blockchain is improved, so asides from earning passive rewards, you will be contributing to blockchain security.
Cryptocurrency and blockchain have progressed to become decentralized finance. This decentralized finance (Defi) is yet to experience mass acceptance, not minding the massive growth it brought. This lack of approval could be due to the volatility of crypto assets, complex Defi protocol, and low-interest rates. Speaking of Low-interest rates, what if you get introduced to a Defi protocol where you will earn 20%APY on your crypto holdings? Anchor protocol offers you this high APY and more. this article will guide on how to earn passive reward from Anchor Protocol.
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What is Anchor Protocol?
Anchor Protocol is a savings protocol based on the Terra blockchain. The protocol was launched in March 2021 and was built by the South Korea-based Terraform Labs. Anchor protocol offers users low volatility of up to 20%. Initially, Anchor protocol, yields could only be accessed as deposits in UST, which helped increase the demand for UST.
This UST is Terra’s USD pegged stable coin that serves an interchain protocol where users can borrow layer-1 native tokens. This is no longer the same since the launch of Ethcoin. With Ethcoin, users can deposit their Ethereum-based stable coins like USDC, USDT, DAI, BUSD, and wrapped UST. With wrapped UST, you will get a 19.5% – 20.5% yield. for other stable coins, you will get a gain of 16.5%
How does the Anchor protocol work?
Anchor protocol serves as a link between lenders ad borrowers of stable coins. Anchor protocol is a money market where lenders can deposit their stable coins on the platform, and borrowers will borrow the stable coin. The lenders earn interest by depositing while the borrowers provide stakeable assets like bLUNA and bETH as collateral to enable them to borrow. The stakeable assets are bonded assets, and once used as collateral, they will be locked up. At the borrowing limit defined by the protocol, you can borrow UST against the collateral.
Anchor protocol operates on a liquid staking mechanism. The protocol will liquidate the staking rewards earned by borrowers on bLUNA and bETH into UST for depositors. These will allow borrowers and depositors to earn a 20% target yield.
Anchor protocol also has Anchor Token (ANC), which is said to be the native and governance token of the protocol. Here there are two types of users: the depositors and the stakers. The depositors will create a governance poll by depositing ANC. Stakers, on the other hand, will vote on the governance polls and, in turn, influence the protocol’s future.
How to buy Anchor protocol from coinbase
Anchor protocol is one of the cryptocurrencies that have a complex buying process. Currently, the Anchor protocol is not available on the coinbase app or coinbase wallet. However, follow the guide below to see how you can navigate the complex process of buying Anchor protocol and also other places where you can buy them. How to buy Anchor protocol
- Visit the CoinMarketCap – at the CoinMarketCap, they will guide you on how to purchase your Anchor Protocol. CoinMarketCap always provides a list of purchasing options for different cryptocurrencies. These options are sometimes listed as market pairs. Once on CoinMarketCap, search for Anchor Protocol and click on the button labeled Market near the price chart. You will see the complete list of all the places you can buy your Anchor protocol and the related cryptocurrencies.
Scroll to pairs, and search for ANC (shorthand for Anchor protocol). A second cryptocurrency always accompanies it. You will use the second cryptocurrency displayed to purchase your Anchor protocol.
alternatively, if you wish to purchase ANC in US dollars, then look for the option of ANC/USD
- Select your most preferred platform
From the platforms listed in CoinMarketCap, choose your best platform. Keep in mind that different platforms operate differently. They all differ in levels of security, reliability, and liquidity. Therefore, before creating an account with any platform, you should endeavor to do appropriate research.
- Make your purchase – Having chosen your most preferred platform, buy Anchor Protocol with it. But first, you should create your account with the selected platform if you don’t already have one. Some of the platforms are easy to use, while others are difficult. You have two choices—either purchase from the platform using USD dollars or purchase using another Crypto.
If you will purchase with another Crypto, the first thing to do is create a Crypto wallet that supports Anchor Protocol. Proceed to buy the first currency. After getting the first cryptocurrency, use it to buy your Anchor Protocol on your chosen platform.
You don’t need to worry; most platforms provide step-by-step guides.
Alternatively, you can join a community of fellow Crypto enthusiasts and find just the right guide.
How to stake Anchor Protocol on Coinbase
So many people want to stake their coins using Coinbase because of how efficient the Coinbase exchange is. Unfortunately, at the time of writing this article, coinbase does not support the Anchor Protocol. However, there are alternative ways of staking the Anchor Protocol.
The easiest way is through the Anchor web app. All you need do is scroll to the governance Module of the Anchor Web App. The transaction is as easy as a single click. You can facilitate this by using the Terra station Browser extension.
Another good news is that Binance allows for staking of the Anchor Protocol. Binance is a reliable and big cryptocurrency exchange. So, you can also stake your Anchor protocol with Binance.
Here is how:
- Create an account – if this is your first time staking your coin on Binance or performing any transaction on Binance, you will have to create and verify your account.
- Go to the Locked Staking Page – open your account, and scroll to Finance>Binance earns on the top panel. Scroll to the locked staking section and click on Go to Staking. You can do this with your mobile phone by connecting to your phone browser.
- Click on Anchor Protocol- Scroll to the “Display Available Only” option on the Locked Staking Panel. The available coins will be filtered and displayed. Go through the options and select Anchor Protocol. Then click on Stake Now.
- Select your Staking Duration and Locked Amount – Scroll to the left panel and select Duration and Locked Amount. Binance offers four timeframes for staking, including 15, 30, 60- and 90-days staking duration.
Pros of Staking Anchor Protocol
Why should you stake your Anchor protocol?
- Anchor protocol gives a high yield of 20APY. This high yield is already enough profit. However, there should be no limit to the amount of interest we should earn. By additionally staking your Anchor protocol, you increase the number of rewards and profits you will make.
- Cryptocurrency and Blockchain have been game-changers for many. Participating in staking allows you to improve the overall security of blockchain.
- Staking your Anchor Protocol is not as tricky and complicated as mining. Consider staking your coin as a massive way of earning
- passive income while doing little.
Staking Anchor Protocol is easy. The main challenge lies in buying it. While buying Anchor Protocol, ensure that you follow the steps we listed to avoid making mistakes
Conclusion.
Staking Anchor Protocol is easy. The main challenge lies in buying it. While buying Anchor Protocol, ensure that you follow the steps we listed to avoid making mistakes.