Best Crypto Interest Platforms 2024
Best Crypto Interest Platform - Bybit
Best Crypto Interest Platforms are:
ByBit - Best Crypto Investment Platforms
OKX (OKex) - Best platform with optimal commissions
Huobi Global - Best for yield generating opportunities
Coinbase - Most Trustworthy Crypto Interest Platform
Binance - Best Selection of Staking Coins
Kraken - Best Terms for Unlocking Coins
Crypto.com - Best Security Features
Cryptocurrency investors who seek a long-term return should definitely consider earning interest on their digital assets. By investing in cryptocurrency to earn interest, you are generating passive income, which can compound your profits if the cryptocurrency markets continue to rise.
There are many platforms offering staking rewards, crypto lending, and DeFi yield farming, all of which pay you in the cryptocurrency you selected and at different interest rates. We've put together a guide to help you start earning interest on cryptocurrencies today.
Best Ways to Earn Interest on Crypto
Crypto Staking
In crypto blockchains such as Cardano, Solana and Polkadot, staking is a popular way to earn interest on holdings and also provides security.
Also later this year, Ethereum 2.0 will switch from a proof-of-work to a proof-of-consensus mechanism. Cryptocurrency exchange platforms already allow Ethereum investors to stake their ETH holdings.
In cryptocurrency, staked coins are locked up and pledged to the protocol. Validation nodes are set up by entities staking crypto as a way to gain access to becoming validators.
As a result, validators are chosen from among the eligible nodes to confirm blocks of transactions. New cryptocurrency coins are created and distributed to the block's validator each time a new block of transactions is verified and added to the blockchain.
10 Best Coins to Stake During The Crypto WinterAs soon as you stake crypto, your node will be used to validate transactions and you will get paid for doing so. With more crypto staked, you will be allotted more transactions to validate, and you will receive more payments.
Several crypto exchanges and platforms allow you to stake crypto, including Crypto.com, Binance, ByBit, Kraken, and Coinbase.
It is possible to reap high returns from crypto staking. But how much you make depends on the crypto coin you’re staking and the exchange you use. For example, for a more conservative approach to investing, you might consider staking stablecoins.
Stablecoin prices rarely fluctuate over time. Because cryptocurrencies are tied to stable underlying assets, they reduce volatility.
As of now, investors can earn an annualized yield of 12.3% by staking their Tether coins. There is only a slight difference in yield between Tether and USD Coin: around 12%. With $100,000 invested in either cryptocurrency, passive income could reach $12,000 per year.
However, stablecoins aren't the only option. There are other cryptocurrencies that use the PoS consensus mechanism that offer attractive yields and can appreciate in price as well.
PoS cryptocurrencies like Solana (SOL) are among the most popular. The yield for staking digital tokens can be as high as 15%, although many exchanges offer lower yields.
Staking Cardano (ADA), another top-10 cryptocurrency, can yield up to 11.2%. However, some exchanges do not pay high yields for staking Cardano.
There is even more potential in the up-and-comer Avalanche (AVAX). There is currently a maximum yield of 21.6% for the digital token available. The yield on Terra (LUNA) can reach 24%.
There are also several metaverse cryptocurrencies with high yields. Binance, for instance, offers yields of over 75% for staking Axie Infinity (AXS).
👍 Pros
•Invest in cryptocurrency and earn interest
•Transactions are faster and cheaper
•Savings on energy
•A potential right to vote
👎 Cons
•Term may be fixed
•Risk of slashing penalty
•There may be fees involved
DeFi Farming
In the same way you earn interest on money in your savings account, DeFi yield farming allows you to earn interest on your cryptocurrency. To reap the rewards of yield farming, you place your cryptocurrency in a "stake" for a period of time and lock it up for interest.
A traditional loan from a bank is repaid with interest. It's the same concept as yield farming: cryptocurrency is lent out instead of sitting in an account, generating profits for the investor
Crypto Lending
Aside from staking and DeFi yield farming, crypto investors can also earn interest by lending their crypto.
An investor can lend crypto through cryptocurrency exchanges or decentralized finance (DeFi) apps that offer crypto interest accounts, which are similar to traditional savings accounts.
As with traditional certificates of deposit (CDs), some lending accounts pay variable crypto interest rates while others pay set crypto interest rates.
Where to Earn Crypto Interest - Top 7 Platforms
ByBit - Best Crypto Investment Platforms
A variety of sophisticated trading tools are available on Bybit's cryptocurrency derivatives platform. Its no downtime commitment means top-quality security. United States residents cannot access it, however. Bybit was established in 2018. The company is headquartered in Singapore.
Compared to other exchanges, Bybit claims to process 100,000 transactions per second (TPS). All precautions are taken to prevent any downtime on the server. Several exchanges face this issue when many users try to trade at the same time.
Many traders find the platform's charting tools very helpful. A crypto staking platform like Bybit allows users to stake their crypto with a minimal level of risk. For stablecoins, such as USDC and USDT, staking rewards can be up to 5%. Flexible deposits as well as 30- and 60-day fixed deposits are available to users.
ByBit Staking Guide - Supported Tokens and RewardsOKX (OKEx) | Best Platform With Optimal Commissions
OKX is a global cryptocurrency exchange known for its wide range of services in the cryptocurrency world. It ranks among the largest crypto exchanges worldwide, serving millions of users in over 100 countries. OKX distinguishes itself as a versatile cryptocurrency exchange by providing a broad selection of 350 popular assets, combined with compelling financial benefits such as low trading fees and high-yield staking.
Trading on OKX is notably affordable, with maximum fees of 0.1%, a fraction of what competitors like Coinbase charge. Deposits and currency conversions are completely free, further enhancing the platform's cost-effectiveness. A standout feature of OKX is its lucrative staking opportunities, offering users the potential to generate passive income through crypto savings accounts, token staking, and flexible borrowing options.
The exchange encourages continual learning through an extensive 'Learn' section on its website, featuring numerous beginner-friendly tutorials, videos, and timely industry articles. Also, OKX expands earning opportunities with its affiliate program, offering a tiered commission structure where increased referrals lead to higher commissions. Affiliates can earn up to a 50% commission in USDT from trading conducted by users referred through their links.
Huobi Global - Best For Yield-Generating Opportunities
Huobi Global, a renowned decentralized spot and perpetual exchange, allows users to trade popular cryptocurrencies, including BTC, ETH, and AVAX, directly from their wallets with leverage of up to 30x. It is recognized for its high-yield opportunities, thanks to its competitive staking percentages, yields, and fees.
Staking is available on several leading cryptocurrencies, such as Algorand, Ethereum 2.0, Chainlink, Polkadot, and Cardano, as well as stablecoins like USD Coin, Dai, and Tether. In line with other exchanges, Huobi rewards stakers with an attractive annual percentage yield (APY) in return for their participation.
Under Huobi Earn, flexible and fixed product options exist for TUSD, USDT, and ETH, delivering up to 20% APY. Users can also stake Huobi Token (HT) and Shiba Inu (SHIB), earning up to 20% and 2% APY respectively. New users get a special offer, as by depositing USDT, ETH, BTC, DOT, DOGE, or SHIB into Huobi Earn, they stand to earn a staggering 50% APY. Thus, Huobi Global combines lucrative trading and yield-generation capabilities, making it an ideal choice for crypto enthusiasts.
Coinbase - Most Trustworthy Crypto Interest Platform
Coinbase supports 100 crypto coins, which makes it one of the most popular crypto exchanges and brokers. Beginners will love its user-friendly platform. A total of six cryptocurrency staking options are available on Coinbase at the moment: Ethereum, Solana, Cardano, Algorand, Tezos, and Cosmos. As far as yields go, Coinbase provides the best rate (5.75%), when staking Algorand.
It’s important to note that Coinbase staking is not available to US clients. In addition, Coinbase platform users can only receive staking rewards on crypto assets purchased through the platform. Because Coinbase charges 1.49% to trade, this could present a problem. In addition, using a debit card to purchase coins will cost 3.99%.
Besides staking, Coinbase also offers DeFi yield services. In both cases, Dai and Tether are supported; however, yields may vary depending on market conditions. Coinbase's mobile app for Android and iOS allows users to track staking and DeFi yield rewards in real time.
Coinbase Fees ReviewBinance - Best Selection of Staking Coins
In terms of daily exchange volume, Binance is the largest crypto exchange. Furthermore, it supports over 100 staking coins, making it one of the most popular crypto staking platforms.
There are two types of staking on Binance: locked and flexible.
As implied by the name, locked staking involves a fixed bond period, while flexible staking offers more freedom at the expense of a reduced staking reward. In addition, locked staking allows flexible withdrawals, but you'll lose out on your rewards.
Binance's locked staking generally holds funds for 30 days, but some coins allow 10- or 15-day staking periods. In addition to offering higher annualized percentage yields (APY), they are also safer.
Staking with DeFi offers flexible locking periods. In this case, you invest in third-party DeFi projects, which may result in your staking amount being forfeited if the smart contract is attacked.
However, DeFi staking has the major advantage of not requiring you to maintain an on-chain wallet for each project you stake. Moreover, there are very short bond periods, usually 24 hours.
Binance may, however, be confusing for some. Alternatively, you can stake from a Trust Wallet that is officially supported by them. The Binance platform doesn't charge any staking fees either, just like Kraken.
Kraken - Best Terms for Unlocking Coins
According to CoinMarketCap, Kraken is the fourth largest crypto exchange. In addition to allowing staking in 12 crypto assets, Kraken also supports unstaking for most crypto assets.
When you unstake, you are taking your staked money out so that you can trade or withdraw it. As a result, there is no bonding period in practice.
Also, Kraken gives you staking rewards once or twice a week depending on the coin you stake. As you earn rewards, you can stake them further to maximize your earnings.
Kraken refers to this method as on-chain staking. In select countries, they also offer off-chain staking. As a final note, Kraken does not charge a fee for staking or un-staking.
Kraken Fees ReviewCrypto.com - Best Security Features
Among the best crypto staking platforms, Crypto.com allows users to earn rewards by holding their stablecoins for an annual return of up to 14%.
Staking options at Crypto.com include daily rewards, weekly rewards, and monthly rewards. Alternatively, users can stake their coins individually or in a pool.
You can also manage your staking rewards easily on the platform thanks to its user-friendly interface. They provide a mobile app that lets you set a staking period - which can be flexible or long-term - with a few taps, so you can manage your investments on the go. In addition, Crypto.com offers a wide variety of altcoins for you to stake. Therefore, each type of staker can find the right staking platform, regardless of their level of experience.
Adding CRO tokens to the stake pool increases your rewards. The CRO token is their native token, which compel users to hold them.
The bottom line? For newcomers to cryptocurrency staking, the Crypto.com platform is relatively straightforward.
Best Crypto Staking Platforms Interest Compared
Your needs as an investor will determine the best crypto investment platform that allows you to earn interest. Use a platform with no minimum lock up requirements for your savings account if you aren't planning to hold crypto for the short term.
Additionally, you should consider which cryptocurrency you'll earn interest on, so you can compare rates.
Refer to the table below to compare the different APYs you can earn when staking, depending on the type of coin and platform.
| Binance | ByBit | Huobi Global | OKEx | Crypto.com | |
|---|---|---|---|---|---|
Tether (USDT) |
10.00% |
4.25% |
Up to 20% APY |
10.00% |
6.5% |
USD COIN (USDC) |
N/A |
5.50% |
Up to 20% APY |
12.00% |
6.5% |
Ethereum 2.0 (ETH) |
5.20% |
1.75% |
Up to 20% APY |
4.07% |
4% |
Binance Coin (BNB) |
10.00% |
N/A |
Up to 20% APY |
N/A |
3% |
Solana (SOL) |
1.50% - 14.79% |
0.58% |
Up to 20% APY |
12% |
4.5% |
Cardano (ADA) |
2.00% - 15.79% |
0.55% |
Up to 20% APY |
5% |
3% |
Cosmos (ATOM) |
1.42% - 30.49% |
1.10% |
Up to 20% APY |
N/A |
5% |
Tezos (XTZ) |
2.00% - 8.67% |
N/A |
Up to 20% APY |
N/A |
N/A |
Polkadot (DOT) |
3.00% - 20.98% |
1.32% |
Up to 20% APY |
N/A |
12.5% |
Algorand (ALGO) |
1.00% - 8.24% |
5% - 10% |
Up to 20% APY |
N/A |
3% |
|
|
|
|
|
|
Is Crypto Interest a Good Idea?
Earning interest on your cryptocurrency investments is an excellent way to grow your income. If you need to withdraw your cryptocurrency holdings, many platforms allow you to do so at any time.
However, there are some companies that require you to keep your crypto in your savings account for a minimum period of time. In this case, you are more exposed to cryptocurrency price volatility. A falling cryptocurrency's value would make your investment worth less even though you'd earn interest.
Earning Interest on Crypto: How to Reduce My Risks
You may face the following risks when staking crypto:
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There is a possibility that the value of the cryptocurrencies you are lending could decrease. Impermanent loss is the result of such a process.
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As liquidity pools become more popular, interest rates decrease.
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There are some liquidity pools that turn out to be scams. Others lose their cryptocurrency after being hacked.
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It is always possible to suffer an impermanent loss with cryptocurrencies due to their volatility. Cryptos you lend may drop in value, thereby wiping out any interest gains you made. An APY of 100% doesn't matter if you're earning it on a cryptocurrency that suffered a 90% price decline.
Liquidity pools that perform well usually have lower interest rates. To attract lenders, pools with little value have to offer high interest rates. Interest rates decrease as more crypto is added.
Finally, there is the issue of security. It is common for scammers to use liquidity pools as a playground. People have created many pools solely to steal other people’s crypto. Liquidity pools and exchanges are also targets of hackers.
Here are a few tips you can follow to reduce risk when earning interest on your crypto
1. Don't invest more than you can afford to risk
2. Diversify such a portfolio between different coins and projects.
3. Invest in the most reliable projects.
Best Crypto Wallets Security & Fees ComparisonHow to Invest in Crypto: A Guide for Beginners
Make a decision about which cryptocurrency exchange to use. Choose a reputable, well-known exchange with a large currency selection.
Sign up for an account with a cryptocurrency exchange. In order to complete the registration process, you will need to provide your personal information and verify your identity.
Make a deposit into your account using fiat money. Cryptocurrencies can only be purchased with another currency, such as U.S. dollars, first.
Select a cryptocurrency that you are interested in buying. The number of cryptocurrencies you invest in is up to you. Make sure you research your options before making a decision.
Buy your chosen cryptocurrency. To submit and complete a buy order for cryptocurrencies, follow the steps provided by the exchange.
Use a digital wallet to store your cryptocurrency. When you purchase cryptocurrency, you will receive a digital wallet that stores the information you need to access it. It can either be hosted by the cryptocurrency exchange or by an independent provider.
Is Crypto Interest Taxed?
The way crypto interest is taxed varies widely across different territories. Here's an overview of how different regions handle this:
United States: Digital currencies are subjected to both capital gains and income tax. Gains on cryptocurrencies held for less than a year, also known as short-term gains, are taxed according to your federal income tax bracket, ranging from 10% to 37% for the fiscal year 2022-2023. The long-term capital gains tax rate is applied if the digital currency is held for over 12 months before selling.
Georgia: Known as a cryptocurrency tax haven, both companies and individuals in Georgia aren't taxed for income generated through cryptocurrency transactions, as per the country's Finance Ministry.
France, Austria, Croatia, Poland, and Italy: In these European nations, transactions from one cryptocurrency to another aren't taxed as long as digital assets aren't converted into traditional fiat currencies.
Bahrain, Barbados, United Arab Emirates: These jurisdictions have no tax obligations on the usage of cryptocurrencies.
United Kingdom: Cryptocurrencies are classified as property and are subjected to Capital Gains Tax, with a rate of 20% for higher and additional rate taxpayers and 10% for basic rate taxpayers.
Canada: The income derived from cryptocurrency transactions is generally treated either as business income or capital gain, contingent on the circumstances. Even cryptocurrency exchanges are seen as taxable events.
Australia: Like in the UK, cryptocurrencies are viewed as property, and they are taxed under Capital Gains Tax or Income Tax. Any interest accrued from staking or other similar methods on cryptocurrencies is taxed based on its fair market value when received.
Remember, tax laws and regulations relating to cryptocurrencies are frequently updated and vary by jurisdiction. It's always recommended to seek professional advice on how to calculate and report taxes due on cryptocurrency transactions to the relevant tax authorities.
Are Crypto Interest Accounts Safe?
Crypto interest accounts have gained popularity for their high yields. However, like all investments, they come with risks. To determine their safety, understanding these risks is crucial. Here are some of them:
Platform Risk: The platform where you hold your account may be vulnerable to security breaches, potentially losing your investments. To mitigate this, choose platforms with robust security measures and a positive reputation.
Default Risk: There's always a risk the borrower could default on their loan, causing losses. This can be minimized by using platforms that have stringent borrower requirements and reliable collateral management.
Market Crash Risk: Crypto markets can be volatile, and a market crash can erode the value of your assets. Diversifying your investment portfolio can help buffer against market volatility.
Regulatory Risk: Crypto regulations can change suddenly, affecting the value and liquidity of your assets. Staying informed about global crypto regulatory trends and diversifying across different assets can help mitigate this risk.
Liquidity Risk: There might be a scenario where you can't withdraw your assets due to the platform's liquidity issues. To minimize this risk, consider platforms that have a large user base and a high trading volume.
While crypto interest accounts can offer significant returns, they are not without risks. Navigating these risks intelligently by understanding and mitigating them can go a long way in ensuring the safety and growth of your digital investments. You also can be interested in information about How To Set Up A Cryptocurrency Trading Account.
Summary
Cryptocurrency staking offers much higher passive income potential than many other popular options. Don't forget, however, that there are risks involved.
Moreover, the cryptocurrency price could plummet. With the underlying token's price sinking twice as much, a 15% or 30% yield doesn't seem so great. This risk applies even to stablecoins.
You are also usually required to lock up your digital tokens for a period of time when you stake them on exchanges. In volatile markets, this restricts your flexibility. In addition, the unstaking process can sometimes take several days or longer.
Some investors, however, may want to stake their coins if they are confident about the long-term prospects of a particular cryptocurrency. There's no doubt it's one of the most intriguing ways to earn passive income.
FAQ
What is staking?
Some cryptocurrencies allow staking as a unique feature. In proof-of-stake blockchain systems, users stake cryptocurrency to lock a certain amount of their funds for a period of time. Blockchain networks use proof-of-stake mechanisms to verify transactions and consensus. By staking their coins, users receive rewards as an incentive.
What cryptos can I stake?
It is estimated that more than $132 billion is locked up in proof of stake support. ETH, SOL, and ADA are the cryptocurrencies with the highest stake market caps, where the typical annual yield ranges from 4% to 5%. Cryptocurrencies that are yield-bearing are Algorand, Ethereum 2.0, Chainlink (LINK), Polkadot (DOT), and Cardano, which are the most common ones traders stake for passive income.
How can you stake on a hardware wallet?
It is easy to stake on a hardware wallet. Stake your coins by installing the coin app on your wallet of choice, creating a new account, and transferring your coins.
Is staking risky?
In order to use or transfer tokens, users have to wait for a "vesting" period, or lock-up period, before they can do so. Due to the fact that users will not be able to conduct transactions with their token(s) for some time, it's important to research the crypto they're staking. You typically have to lock up your cryptocurrency for a minimum period of time on cryptocurrency exchanges. In addition, if you stake a volatile cryptocurrency, your tokens may be locked up, which prevents you from selling them.
Methodology for compiling our ratings of crypto exchanges
Traders Union applies a rigorous methodology to evaluate crypto exchanges using over 100 quantitative and qualitative criteria. Multiple parameters are given individual scores that feed into an overall rating.
Key aspects of the assessment include:
User reviews. Client reviews and feedback are analyzed to determine customer satisfaction levels. Reviews are fact-checked and verified.
Trading instruments. Exchanges are evaluated on the range of assets offered, as well as the breadth and depth of available markets.
Fees and commissions. All trading fees and commissions are analyzed comprehensively to determine overall costs for clients.
Trading platforms. Exchanges are assessed based on the variety, quality, and features of platforms offered to clients.
Extra services. Unique value propositions and useful features that provide traders with more options for yield generation.
Other factors like brand popularity, client support, and educational resources are also evaluated.
Glossary for novice traders
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1
Broker
A broker is a legal entity or individual that performs as an intermediary when making trades in the financial markets. Private investors cannot trade without a broker, since only brokers can execute trades on the exchanges.
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2
Cryptocurrency
Cryptocurrency is a type of digital or virtual currency that relies on cryptography for security. Unlike traditional currencies issued by governments (fiat currencies), cryptocurrencies operate on decentralized networks, typically based on blockchain technology.
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3
Yield
Yield refers to the earnings or income derived from an investment. It mirrors the returns generated by owning assets such as stocks, bonds, or other financial instruments.
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4
Trading
Trading involves the act of buying and selling financial assets like stocks, currencies, or commodities with the intention of profiting from market price fluctuations. Traders employ various strategies, analysis techniques, and risk management practices to make informed decisions and optimize their chances of success in the financial markets.
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5
Ethereum
Ethereum is a decentralized blockchain platform and cryptocurrency that was proposed by Vitalik Buterin in late 2013 and development began in early 2014. It was designed as a versatile platform for creating decentralized applications (DApps) and smart contracts.
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Team that worked on the article
Ivan is a financial expert and analyst specializing in Forex, crypto, and stock trading. He prefers conservative trading strategies with low and medium risks, as well as medium-term and long-term investments. He has been working with financial markets for 8 years. Ivan prepares text materials for novice traders. He specializes in reviews and assessment of brokers, analyzing their reliability, trading conditions, and features.
Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.
Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).