Earning passive and additional income on crypto has been made easier with staking. Different cryptocurrencies have embraced the staking option, making it possible for investors to expand their earnings. One of such cryptocurrencies is Algorand. If you have an ALGO coin, you may consider staking it. This article will explain everything you need to know to Stake Algorand for the best staking rewards.
What is Algorand?
Algorand is a blockchain platform and a digital currency. Silvio Micali founded the Algorand platform and cryptocurrency in 2017. Silvio Micali is a professor at the Massachusetts Institute of Technology and a noted cryptographer. Algorand functions as a payment processor, and it uses one of the consensus mechanisms known as proof of stake.
Algorand is a strong competitor of Ethereum, which explains why it is marketed as an efficient and scalable platform. This is so because Algorand can host other blockchain and cryptocurrency-based projects.
Anyone can view and contribute to the Algorand platform code because it is an open-source blockchain. The Algorand blockchain does not use the traditional proof-of-stake method; instead, they use the modified version of proof of Stake. Cryptocurrencies using the conventional proof of Stake give validators a chance to opt-in themselves. In the modern proof of Stake which Algorand uses, they choose their validators by recruiting from the entire pool of ALGO holders. This makes the pure proof of Stake to be more potent in securing the blockchain network. Choosing validators randomly from different ALGO pools increases the security of the blockchain network.
How does Algorand staking work?
Algorand is among the cryptocurrencies that have embraced the concept of proof of stake, thereby solving the issues of proof of work. Every blockchain network using the proof of Stake needs validators to verify transactions written to each block. Algorand chooses its validators through a process called sortition. They, in turn, give particular preference to validators who are holding a large number of tokens.
Staking your Algorand coin works just like so many other Crypto exchanges. Algorand staking works differently on different exchanges. The rewards you will earn depend on the exchange or wallet you chose to stake your ALGO. Some exchanges and wallets charge staking fees while some others don’t. The Algorand rewards differ based on different exchanges.
How to stake Algorand
You can stake your Algorand using different exchanges, platforms, and wallets. You can decide to use some popular exchanges and stake your Algorand, have in mind that each exchange has its Pros and Cons. Some of the best exchanges for Algorand include
- Binance – binance is a big exchange platform that added support for staking ALG0 in July 2019. You can stake your Algorand and other coins on Binance. Binance stands out amongst other exchange platforms because it offers high exchange features and enables staking. Binance does not charge staking fees, so you don’t have to bother about
the first and most important requirement you need to stake your Algorand on Binance is 100 ALGO. If you don’t have up to that amount, 100 Algorand goes for $180. The cost is high, but you should consider getting it because Binance offers excellent rewards. However, there are other that requires less ALGO when you want to stake
Binance offers a good staking reward. The reward you will earn on Binance depends on your chosen staking option. The longer the staking period, the higher the reward. Staking your ALGO for one week offers you a 1% reward rate. Staking for one month provides you with a 10% reward rate. While staking for 90 days offers you a 25% reward rate. Staking for more extended periods in Binance offers you more staking rewards. The choice is solely yours to make.
Here is how to stake your Algorand on Binance
- 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 ALGO- 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 ALGO. 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.
However, if you lock your assets under flexible savings, you will have to redeem them before you can stake them. In the right panel, you will see: Stake date, Value date, Interest period, Interest end date, Redemption period, Estimated APY, Estimated Interests.
- Coinbase – coinbase is a big exchange platform that allows Staking. Coinbase processes millions of transactions daily. Staking with a coinbase is feasible for everyone because you need one-dollar worth of Algorand. Almost everyone who wishes to stake Algorand can afford it. While staking with Algorand, your staked ALGO will earn you a 4% reward. However, Coinbase is among the exchange platforms that charge staking fees. Coinbase charges as much as a 25% staking fee. So, if you can put up with that, go ahead and stake your Algorand with coinbase. If you consider the staking fee high, you can opt for other exchange platforms that charge less.
Follow these few steps to stake your ALGO on coinbase
- Log into your account
You can choose to Log into your coinbase account through the Coinbase App. You can also Log in from the desktop version of the Laptop.
- Get Verified
for you to do anything on Coinbase, you must have your identity verified. The same is applicable for the while staking.
- Join the staking waitlist
There is a staking waiting list for eligible users on Coinbase. Only qualified users can stake, so you have to join the staking waitlist. Once your account meets all the requirements for staking ALGO, you will be accepted within hours.
- choose the Amount of ALGO to stake
once you have been accepted; select the amount of ALGO to stake
- to earn your rewards
after completing the four significant steps, the next is to wait for your reward. Coinbase offers a 4% staking reward.
- Kucoin – kucoin is an exchange platform that uses the soft staking method. Soft Staking is the process of staking your coin without having to lock them up. This is an added advantage when staking with Kucoin. Algorand staking does not require locking up even with other platforms, but with Kucoin, you will get daily rewards.
A 5.27% reward is offered annually by Kucoin when you stake your ALGO. You can earn $1.44 daily when you stake $10,000. The downside to Kucoin is that they charge a staking fee of 8%. The staking fee will be deducted from the rewards you earn. If you are okay with the staking fee, go ahead and stake with Kucoin, or you can try other exchanges with lower staking fees.
Here is how to stake your Algorand on Kucoin
- log in to your account
The first step is to log into your account. Once you log in, click earn.
- Click on ALGO.
The next step is to click on the section. Then go ahead and click on ALGO. Read all the contents carefully, enter the amount you want to stake, and click on subscribe.
- Check the staking product.
After subscribing to ALGO, you can check the staking history. When it is time to earn your rewards, they will be transferred to your main account.
Once you successfully Log in to your kucoin account, you can easily navigate it.
- Trust Wallet – you can use your Trust wallet’s mobile app or your computer’s web browser to stake your ALGO. Trust wallet is a software crypto wallet that you can use to stake. To stake with Trust wallet, you need a minimum of 1 ALGO.
Trust wallet offers a staking reward of 5-6% annually. Trust wallet does not charge any staking fee aside from the staking rewards.
Here is how to stake Algorand on Trust Wallet
- create your wallet
If this is your first time using or staking with Trust Wallet, you will have to download the wallet. Then go ahead and create your account
- click on ALGO
on the app, click on the discover section. Scroll to the top and see the lists of coins available under Staking. Click on ALGO
- pay for the Coin
once you find the ALGO coin, you can pay with your bank card using MoonPay. MoonPay is a third-party provider on Trust Wallet.
- Choose the amount to Stake.
After paying for the ALGO coin, choose the amount you want to stake and proceed.
Where to buy Algorand
You can buy your ALGO coin through some popular or major exchange like Kraken or coinbase. You need to choose your most preferred exchange and create an account with them. After the account creation, fund it using your local currency. Then go ahead and store your ALGO. You can store using a self-hosted wallet or a wallet hosted by your chosen cryptocurrency exchange.
Pros of staking Algorand
Staking Algorand has excellent benefits. If you are still contemplating whether to stake your Algorand Coin, here is why you should
- Staking your Algorand coin is an excellent way to earn passive income
- So many exchanges have already added Algorand to their staking options. This gives you different exchanges to choose from.
- Staking your Algorand will help to improve the overall security of blockchain.
You can easily stake your Algorand and earn good staking rewards. Ensure that you follow the steps listed in this article. The most important step is to find your most preferred exchange and see that you meet up to their requirements. Algorand won’t be responsible if anything goes wrong during the staking process. Therefore, you should ensure that you choose a well-trusted exchange while staking.