Crypto staking can offer investors high returns with relatively low risk. Here you will find 5 particularly interesting blockchain projects that offer staking.
Why crypto betting makes sense, especially in a bear market
Crypto staking allows investors to pledge their holdings to support the operation of a blockchain network. In return, investors receive management rights and interest (stake rewards). Complementing a buy-and-hold investment strategy, staking crypto is an effective way to position your portfolio for profit in bear markets.
However, investors should be convinced of the long-term nature of the locked cryptocurrency. Because the cryptos are not available to the investor during the selected bet period.
Exception: In addition to the normal staking of cryptos, some providers also offer so-called “liquid staking”. “Liquid staking” makes it possible to pay out the used cryptos at any time. This increases flexibility for investors.
The 5 best crypto coins
Several factors are relevant to choosing the best coins and tokens for staking. Investors should not buy crypto simply because the stated stake rewards are high. Often the reward is given without the inflation in the network. Therefore, investors should always keep an eye on “Adjusted Rewards”.
In addition, we include in our analysis market value and the height of “Set market value” with a. From these values, the so-called “Employment ratio”i.e. the proportion of all coins or tokens locked in the network.
These values allow for a general assessment of investor confidence in cryptocurrencies. The more assets investors entrust to a network, the greater the probability of the project’s success. At least in theory.
5th place: The classic – Ethereum
The merger was accompanied by the switch of the second largest cryptocurrency by market capitalization to the proof-of-stake consensus mechanism. The Ethereum core developers recently announced the timeline for the Shanghai upgrade and thus the possibility for “stakers” to withdraw their lured coins and rewards. It should be ready in March 2023.
When it comes to the security of a staking facility, Ethereum undoubtedly tops this list. The investment capital is over USD 21 billion. This means that 13.51% of all ethers are locked. This value is expected to increase as the network develops. However, Ethereum currently offers an inflation-adjusted interest rate of 3.85%. There is still room for improvement.
4th place: The stablecoin – Tethers USDT
Earning stake rewards on a stablecoin is arguably the closest thing to traditional savings with an interest rate. The principle seems low risk and the interest rate of 6.56% attractive compared to the interest rate offered by the banking sector.
However, Tether is currently under fire from the media and has certain project-related risks. Stablecoin’s cover appears to be on shaky ground and there is a connection to the FTX scandal. The bet ratio of less than 2% also speaks for itself Does not for the greatest trust.
The uncertainties are also reflected in noticeable bumps in Tether’s monthly price:
Depending on the extent to which the investor has confidence in USDT and Tether, stablecoin stakes may be considered. Alternatively, it may be worth taking a look at the stablecoin landscape to pick your favorite to stake. Circle’s USD coin offers an adjusted APR of 5.32%.
3rd place: The Connector – Cosmos (ATOM)
Cosmos Hub is a blockchain protocol that enables blockchains to communicate with each other. It works similarly to a computer, where projects share files that can be opened on any operating system.
The project seems to create a lot of trust among users – 64.60% of all ATOM tokens are included in the stake program. However, the stated APR of 19.25% raises false hopes. Because after adjusting for inflation remain 5.98% interest left – nevertheless an acceptable value.
A similar project, Polkadot, offers an APR of 6.90% with a stake ratio of just under 46%. Depending on which “multi-blockchain project” the investor prefers, both projects seem like good investment opportunities.
2nd place: The Gamer – Axie Infinity (AXS)
The bear market is in full swing and the crypto game hype is over. Nevertheless: in light of the data, separated from all subjectivity, betting the AXS token seems lucrative and credible.
Users who buy Axie Infinity’s cryptos stake the assets at a stake of 43.18%. Listed by market capitalization, Axie Infinity is currently ranked 51st in the overall comparison of all crypto projects. The gaming token offers an inflation-adjusted APR of 21.83%. Not a bad record considering all the data.
1st place: The DEX – PancakeSwap (CAKE)
CAKE emerges as the winner of the data comparison. The decentralized crypto exchange (DEX), which was built on the Binance Smart Chain, impresses above all with its high inflation adjusted APR of 35.65%. As a solid DeFi project, PancakeSwap currently ranks 64th by market cap in a general comparison. The investment ratio is 24.11%.
The exchange thus offers a solid framework that relies on the Binance Smart Chain. Depending on how investors assess the future of this blockchain and the DeFi sector, the project is more or less attractive for a staking project. Like most solid cryptos in the bear market, CAKE generally offers great upside potential.
Ultimately, the evaluation of the projects is based on each investor’s own research. The classification is in no way to be classified as investment advice. Always do your own analysis! Rather, the data included in the evaluation should offer a possible approach to project selection.
If you are considering buying and betting cryptos, feel free to discuss with like-minded people in our Telegram group.
All information on our website has been investigated to the best of our knowledge and belief. The journalistic contributions are for general information purposes only. Any action taken by the reader based on the information on our website is entirely at his own risk.