One of the most popular ways to become wealthy in the last few centuries has been through passive income generation. In addition, there are still many ways to make a passive income nowadays. Some new choices in the bitcoin sector, however, are emerging and spreading.
Staking is a technique that allows cryptocurrency users to earn additional cryptocurrency with minimal risk. As a result of staking, users will be able to earn APY from numerous platforms. There is a wide range of APY rates depending on the time period and the site you are using to stake the coin.
Here, I’m going to go through the best places to put your Solana (SOL) tokens to work. Also, a thorough plan to begin staking SOL tokens on the various sites.
What is Solana (SOL)?
Using blockchain technology, decentralised transactions are now possible. However, the technology we employ to transfer cryptocurrency has a fundamental drawback: it’s slow.
A good comparison is to compare the Ethereum network, which processes roughly 15 transactions per second, compared to Visa, which processes thousands of transactions per second. This helps put things into perspective.
And this is exactly what Solana want to alter for the better. So what is exactly Solana?
With the goal of making high-speed transactions possible while yet maintaining decentralisation, the Solana programmable blockchain was created. In the network, the proof-of-history mechanism is used. For transaction fees, the blockchain’s native coin, SOL, can be staked. SOL The Solana network is a direct competitor to the Ethereum network in terms of functionality.
Solana (SOL) has a market capitalization of $33 billion as of this writing, making it the eighth most valuable cryptocurrency on CoinMarketCap.com, just ahead of Polkadot and Uniswap.
Solana’s recent surge has been tremendous, with a 50% rise in the previous week alone. For those who own this digital currency, they are witnessing their valuables dwindle. Keep it in a safe place, though. That necessitates a well-stocked wallet.
There are several other permissionless blockchains that are concerned about Solana’s ability to compete with older smart contract blockchains. Ethereum, the first blockchain server platform, is often compared to Solana. In comparison, Ethereum can only process between 15 and 45 TPS per second on its platform.
Its main competitors are SKALE Labs, 1Token, ARK and Cindx in terms of size and development history. But the project’s ongoing innovation and design distinguish it from all other blockchains.
Solana attracts buyers from all around the world because of its rapid expansion and development as a business. Increasingly, SOL may be traded for fiat or other cryptocurrencies on more and more crypto platforms.
There are numerous exchanges where investors may acquire SOL, including Binance, Bitfinex, FTX, Coinbase and others. SOL can also be used as a staking device.
What is Solana (SOL) Staking?
Staking is the process of participating in transaction validation on the Proof of Stake (PoS) blockchain. For the user to be eligible for rewards, they must make a deposit of at least the minimum amount.
PoS (Proof of Stake) consensus is used by Solana instead of Bitcoin’s PoW (Proof of Work) (Proof of Work). Decentralized networks create new coins, thus it’s important to learn about crypto mining before getting started.
The Proof of Work algorithm is implemented on specialised hardware in Bitcoin. However, Ethereum and Solana are using Proof of Stake (PoS) software technologies to mint new tokens.
It is a win-win situation for everyone involved when SOL tokens are staking.
For investors, both PoS and PoW are ways to generate money from cryptocurrencies. Solana uses the PoS consensus technique whereas Bitcoin uses the PoW (Proof of Work).
In order to prove proof of work, a mathematical challenge must be solved for a percentage of the tokens mined. You must wager or put your crypto at risk in order to reap the benefits of proof of stake.
Keep in mind that staking is just as profitable as mining, just at a lower cost. In addition to collecting a passive income, staking helps to safeguard and protect the blockchain.
Like other PoS-based cryptos, Solana’s staking process is simple. The framework was used to build Ripple, Cardano, Polkadot, and other cryptocurrencies.
Cryptocurrencies like Bitcoin, Ethereum, and Dogecoin use the PoW algorithm, which is more expensive, energy-intensive, slower to mine, and necessitates more cash. It’s common for wallet holders to delegate tokens to Solana validators, who process transactions and manage the network.
Delegating stake is a financial approach that allows token holders to reap rewards over a lengthy period of time by sharing the risk and profit. For this purpose, token holders (delegators) and the validators to whom they delegate are aligned financially.
It is also depending on the current inflation rate, the total quantity of SOL staked on a network, and an individual validator’s up-time and commission rate (fee).
Ultimately, there is no need for specialised knowledge or expensive hardware devices. Lock your SOL coins in a wallet and you’ll get paid while you’re sleeping.
Best Platforms to Stake Solana (SOL)
An summary of the best places to stake Solana is provided in this comparison guide. An evaluation of the platform’s features, an estimate of its annual income, costs for purchasing cryptocurrency, and a minimum staking period are all part of the study’s methodology.
With a Binance or Kraken trading account, you may start staking SOL there to get the most out of your investment. Solana may be staked on some of the most popular exchanges in the world, and I’ll go over each one in detail below.
|Platform||APY||Min. staking period||Fees|
|Binance||9.2 / 9.9%||30 – 60 days||0.08%|
|Ledger Nano||9 / 10%||flexible||1.7 – 4.5%|
As measured by trade volume over a 24-hour period, Binance is the largest cryptocurrency exchange worldwide. On a daily basis, it attracts millions of cryptocurrency investors on its site. Also available are custodial wallets, crypto margin trading, lending services, and the opportunity to earn staking incentives.
Use this link to sign up for a Binance account, and you’ll pay no fees at all. The additional 10% discount is good for the rest of your life.
Users can earn free staking rewards by depositing and keeping cryptocurrencies on Binance and staked them. Furthermore, staking SOL tokens on Binance is free.
Staking SOL on Binance has the advantage of allowing cryptocurrency traders to hold their tokens while they await a deal. A trader’s potential profit can be supplemented by staking prizes.
Steps to start staking Solana on Binance
Start by following these instructions to get started staking Solana(SOL) on Binance.
- You can sign up at Binance for free.
- When looking for finance at the top menu, select “Binance Earn” from the drop-down.
- Just underneath the ‘Binance Earn’ header, select SOL from the drop-down selection.
- If you don’t have any SOL funds in your wallet, you can either buy them from the market or deposit them.
- You can store SOL tokens here by clicking the ‘Stake’ button.
Kraken is one of the safest and most reputable bitcoin exchanges on the market. A US-based cryptocurrency trading platform, Kraken was founded in 2011 and is available in 48 US states and 176 countries. A ticker (BTC/USD) on Bloomberg is also based on the exchange data because of its reputation for safety.
The Kraken platform specialises on providing Bitcoin trading services for both novice and experienced traders. It is also possible to store your digital assets in custodian wallets, use crypto lending services and staking cryptocurrencies in addition to trading digital assets.
You pay a 0.16 percent cost for spot trading crypto (Bitcoin, for example), but this fee falls as the volume of the US dollar increases. Margin trading costs even less when the interest rate is set at 0.01%.
At the time of this writing, Kraken allows users to stake Solana in 10 different cryptocurrencies, including Bitcoin and Ethereum. Buying the cryptocurrency you wish to stake and depositing it into the exchange’s staking wallet is all that is required to get started.
Steps to start staking Solana(SOL) on Kraken
Solana can be staked at Kraken by following these steps:
- For free, sign up for a Kraken trading account
- On the exchange, if you don’t already own SOL tokens, you can buy them for a fee
- If you prefer, you can deposit your SOL tokens under ‘Accounts’ and then ‘Spot’ in order to use them.
- Go to the upper menu and select ‘Earn’.
- Select Solana and click the ‘Stake’ option.
- Staking must begin immediately.
In comparison to the other options, FTX is the most recent addition to the list of crypto trading companies. As stated in their mission statement on their website,
For traders, FTX is a cryptocurrency exchange that was designed from the ground up. FTX’s innovative products include futures, options, volatility products, and leveraged tokens that are industry firsts. In order to meet the needs of both professional traders and first-time users, we are developing a platform that is both strong and user-friendly.’
It is against their policy to enable US citizens to use their site. Consequently, I must warn you. As a result, they primarily focus on the Asian and European regions. If you want to get around these restrictions, you’ll need a virtual private network (VPN).
How to stake Solana on FTX exchange
Follow these instructions to begin staking SOL tokens on FTX:
- Sign up for a free FTX account now!
- Before depositing SOL at FTX, verify your identity using KYC.
- Or, if you’d rather, you may buy SOL on the market.
- To the right of the menu, select Wallet.
- Once you’ve found your SOL funds, click the ‘Stake’ button.
- On the SOL tab, select ‘Stake.’
- Staking will begin soon once you enter the amount of SOL in the pop-up.
Ledger Nano hardware wallet
The Ledger Nano hardware wallet is the best option if you want to be in complete control of your crypto assets. It is a USB storage wallet with Bluetooth connectivity, such as the Ledger Nano wallet, in particular.
Also, this means that you can store your cryptocurrencies offline, which is the most safe method of storing your digital currency. To make things even more convenient, users of the wallet may send and receive bitcoin from several blockchains and run third-party apps on the device.
A built-in trading feature in the Ledger wallet allows users can do more than just store their currencies. Because Coinify is a third-party service, there is a fee associated with using this feature: 4.5 percent for credit card purchases and 1.7 percent for bank wires.
How to start staking Solana with Ledger Nano
SOL staking isn’t supported by Ledger, therefore you can only store tokens offline with this device if you want to use it. However, if you prefer to keep your private keys offline, you can still use one of the several web wallets to accomplish this.
They are specifically built by Solana developers or in collaboration with the Serum(SRM) team.
To summarise, two web wallets (Solflare and Sollet.io) and one mobile wallet can be used to stake from a Ledger (Moonlet.io).
On desktop and mobile devices, Atomic Wallet is a decentralized online cryptocurrency wallet that supports over 500 currencies and tokens. With its easy, safe, and convenient storage options, the wallet is suitable for all levels of cryptocurrency investors.
The Atomic wallet contains a built-in exchange feature that allows users to buy fresh coins, in addition to staking. As a result of using a third-party service (Changelly), this feature requires buyers to pay an additional 2% additional fees at a minimum of $10 per transaction.
Solana(SOL) is one of the 15 coins that can be staked in the Atomic Wallet. If you put Solana on Atomic for at least 90 days, you’ll get a 7 percent annual return.
How to start staking Solana(SOL) on Atomic Wallet
- Visit the Atomic Wallet website and download the app.
- Start buying or depositing SOL right now.
- Stake now by clicking on “Staking” and scrolling down until you see Solana.
- The ‘Staying Period’ field must be filled in.
Atomic wallet requires a full epoch of waiting before allowing you to un-stake Solana (SOL) (1 epoch lasts around 2 days). You will be able to freely move your funds after the unstake time is over.
One of the most secure wallets around has been in use for a long time and has an established track record. You can store your crypto offline (with Trezor) and then connect to the Exodus software wallet app when necessary.
Additionally, Exodus allows you to store up to 130 different cryptocurrencies in the app and offline.
This wallet has a staking feature that presently supports 25 different coins. This is where you may stake Solana for a 6.13 percent annual return.
How to start staking Solana(SOL) on Exodus Wallet
Solana staking on Exodus wallet is an easy process:
- Download and install Exodus Wallet from the Exodus Wallet website.
- Using the built-in exchange, you can deposit or buy SOL
- Staking Solana will begin automatically as soon as funds are deposited.
In Exodus, if you wish to unstake your SOL, you can only unstake all of your presently staked SOL. It may take several epochs until your funds are once again available for use. Don’t worry if you have to wait a week for the funds to become available, as each epoch lasts about two days.
How long until I earn rewards from my stake?
As a reminder, it may take some time for you to reap the benefits. A reward is earned at the end of each “epoch” (usually 2-3 days) in the Solana validation network.
It takes a whole epoch to begin reaping benefits if you stake Solana to one of the validators.
It’s also important to keep in mind that annual bonuses are roughly 8%. Because of this, epoch-to-epoch payouts will be lower. Given that there are approximately 134 epochs in a year, the reward you pay per epoch is approximately 0.06 percent, therefore you will need to give your investment time to accrue considerable rewards.
Auto-compounding of your stake account means that in every epoch you’ll see a growth in your stake because of fresh incentives. Using this strategy, you’ll get the most out of your staking earnings.
Is solana staking safe? What are the risks, if any?
You may rest assured that staking Solana is completely safe, as the validators you stake with have no authority over your money at any point.
You can request a withdrawal to your primary wallet at any time, but your coins won’t arrive until the conclusion of the epoch, which might take anywhere from a few hours to a few days.
A validator’s commission on your rewards is subject to change at the owner’s discretion, therefore this is a potential risk.
Why does Solana pay rewards to crypto stakers? What are the benefits for them?
Solana aims to provide a decentralized money that is scalable, cost-effective, and rapid. While other coins such as ETH and BTC take a long time to process transactions, a Proof Of Stake (PoS) method ensures that transactions are processed quickly.
In order to do so, the system needs to reward validators for helping with transaction audits. Those that stake their SOL in the validation network partake in these gains because each validator must likewise have a stake as a sign of their trustworthiness.
As the network is spread out over thousands of validators rather than a select few, it prevents bad actors from trying to deceive SOL holders by thwarting attacks on the network.
In a nutshell, by staking your coins on Solana, you not only earn money, but you also actively contribute to the network’s aims and the network’s integrity. For many, this is a compelling motivation to stake coins or run validators, regardless of any financial advantage they could receive.
What APY can you earn staking solana?
As the amount of transactions per day and the speed at which validators finish an epoch change, the APY for Solana can fluctuate, however at the moment it is between 7-8 percent.
If you stake with a validator, the amount of reward you receive each epoch can also be affected by the fee rate they charge. The network displays these openly, and they often fall between the range of 0% to 10%. Note that this rate can be changed by the operators of validators.
How quickly a validator processes and votes on transactions can affect your real-world returns. This can be influenced by factors such as uptime, internet connectivity, and server power.
Is there a minimum amount you can stake on Solana?
Solana does not have a minimum bet amount. Lamports are the smallest units of currency in the Solana system. There are 10 billion lamports in 1 SOL, just like there are 100 pennies in a dollar. Alternatively, a lamport is worth 0.000000001 SOL per unit.
A few lamports can theoretically be staked, but you will have to wait a very long time for any practical rewards, and you will almost certainly pay more on transaction costs than you would ever make.
For the most part, the more money you put in, the more you’ll get back. Compound interest gives you the potential for substantial gains over time, but like with retirement savings, it pays to stake more money earlier in the process.
Is staking Solana worth it?
Cryptocurrency fans are increasingly turning to staking Solana to get passive SOL income with little risk. In this tutorial, I went into additional detail about where to stake Solana and compared the various platforms in terms of returns and lock-up durations.
It’s also straightforward to stake Solana (SOL) tokens, as each one generates a new one. With the SOL token, Solana’s value is on the rise and even a modest amount can make a big difference in the long term.
Staking SOL is a great way for you to make more cryptocurrencies while you’re asleep.