- Solana is a layer 1 network
- Staking is available through wallets
- Staking is available through exchanges
- Staking is available through DeFi platforms
With the crypto market fluctuating almost as quickly as the token prices, it can be difficult to find a good moment to invest. There’s no doubt that this is a risky time to put money into digital tokens. However, with so many projects coming online at once, there are also plenty of opportunities for savvy investors. If you’re thinking about buying some Solana tokens (or any other cryptocurrency) and staking them for a return, here are some of the best places to do it:
What Is Solana?
Solana is a layer 1 network built to rival other networks such as Ethereum. Built for its speed, low transaction costs and scalability, Solana burst onto the scene last year and has since gathered a very large community especially in the NFT space. Solana boasts transaction speeds of up to 10,000 transactions per second and fees as low as $0.002 per transaction.
Due to its low fees the network quickly became popular for its NFT ecosystem which has continued thriving even during the bear market.
Where to Stake Solana For The Best Returns?
The Solana network is built using governance nodes which allow transactions to be processed and allows participants in the nodes to earn rewards via “staking”.
There are a handful of places that you can use to participate in this and stake your Solana. There are three main options for staking, directly from a staking friendly wallet such as Phantom, through an exchange such as Binance or through a DeFi protocol such as Marinade Finance.
Let’s start with a wallet.
Phantom has quickly become the number 1 wallet in the Solana space offering a browser extension and also most recently a mobile wallet. A lot of people find this to be the preferable method of staking as it is very user friendly and allows you to do it straight out of your wallet rather than have to play around with other platform.
To stake your Solana within Phantom you simply have to click the 3 dots in the top right of your wallet and select “Stake Solana”. From there you can choose which validator you would like to stake your Solana with, this list will also show the validator fees.
Next up we have staking through an exchange.
Very similar to staking straight from the wallet and another preferable method due to its simplicity.
Binance which is the world biggest exchange by volume offers a very straightforward and simple staking interface which allows you to stake Solana. Staking through an exchange such as Binance is often safer than through a DeFi protocol.
Last up we have staking through a DeFi platform.
Surprisingly even with Solana low fees and quick transaction times there actually isn’t that many DeFi protocols built on the network in comparison to its competitors. There are however a small handful which will allow you to stake your Solana.
Staking Strategies: Where to Buy and Store Your SOL
The first consideration when buying any cryptocurrency is which exchange you’re going to use. Depending on your needs and your level of experience, you may prefer one exchange over the others. If you just want to buy some SOL and stake them immediately, you can use one of the most popular exchanges to do so: Coinbase, Binance, or Kucoin. If you’re going to be holding your SOL for the long term, you’ll need to get a cold wallet: a crypto wallet that is entirely offline and not connected to the internet. This will protect your funds in the event of a hack. If you’re using a hardware wallet, you can stake your SOL there. Alternatively, you can download a Solana wallet such as Phantom and purchase SOL from an exchange, then send your SOL from the exchange wallet to your staking wallet.
Binance is one of the largest cryptocurrency exchanges in the world, and it’s popular among both new and experienced traders. Binance currently supports over 100 different cryptocurrencies, including Solana’s token. If you hold your Solana tokens on Binance, you can choose to enable staking. When you do so, you receive a small percentage of your tokens as an interest payment. This can add up over time, but it can take a while for it to be worth anything. Staking Solana on Binance will require you to keep your tokens in their native SOL wallet. Binance does not provide staking functionality, so you’ll need to hold your SOL in their native wallet to take advantage of this feature.
Coin staking checklist
– Exchange: Do you want to store your Solana tokens on an exchange or in a wallet? If you store them on an exchange, you’ll have access to your funds more quickly, but you will not receive any staking rewards. If you store them in a wallet, it will take longer to move your funds around, but you’ll receive staking rewards along the way. – Cold wallet: If you want to store your Solana tokens for the long term, you’ll want to purchase a hardware wallet to protect your funds. – Solana wallet: If you’re planning to store your Solana tokens in a cold wallet, you’ll need to purchase the wallet and transfer your tokens there. You’ll receive staking rewards as your tokens generate income while you keep them in the wallet.
Pro Tip: Don’t Invest More Than You’re Willing to Lose
When you’re deciding where to buy your Solana tokens and what staking strategy to employ, keep in mind that this is still a very new industry. There are no guarantees that any of these staking platforms will be around in a year, let alone longer. While it’s good to be optimistic about the future, it’s also important to remain realistic. Make sure to only invest what you’re willing to lose, and don’t invest more than you can afford to risk. If you’re careful and diligent, you can find some pretty fantastic staking opportunities in the crypto world. You just need to know where to look!