Staking is a popular choice for crypto owners, given its ability to provide a passive income for those who want to become fully-fledged validators or join a staking pool. You can now stake a variety of popular cryptocurrencies, including Polkadot. But which platforms are best for staking Polkadot, and why?
Is There a Minimum Required to Stake DOT?
Before becoming a validator by staking Polkadot, keep in mind the 120 DOT minimum requirement. At the time of writing, this amounts to around $4,700, so make sure you can stake such an amount beforehand. However, you can always join a staking pool with a lot less (though the minimum requirements differ depending on the platform you use).
1. Kraken
Kraken's crypto exchange is one of the best places to stake crypto in general. It's a well-known and reliable exchange that has been around for over a decade now. Since its founding, it's become a hugely popular platform for buying, selling, and staking different cryptocurrencies and currently has a trading volume of over $2 billion. But why is Kraken great for staking Polkadot in particular?
It offers great rewards for staking Polkadot. Currently, you can earn an annual reward amounting to 12% of your staked Polkadot, one of the highest reward percentages that Kraken offers! The exchange's staking minimum is just 0.2 DOT, so you don't exactly need big bucks to get started with staking Polkadot on Kraken.
However, staking on Kraken doesn't come for free. The exchange currently takes a 15% cut of your total annual earnings, so take note of this to avoid a nasty surprise at the end of your staking period. There are other exchanges and platforms that don't charge a fee for staking, so it might be worth considering those before trying Kraken if you're looking to keep the entirety of your rewards.
2. Binance
Binance is another world-renowned cryptocurrency exchange. It was founded in 2017 but already has a place as one of the most popular crypto exchanges. Currently, Binance has an incredible trading volume of over $114 billion and allows you to stake multiple crypto coins, including Polkadot. So, why choose Binance?
First off, there is no fund minimum for staking Polkadot on Binance, making it financially accessible to everyone. Secondly, Binance offers rewards for staking Polkadot via its DOT slot auctions or parachain auctions. This involves staking Polkadot for a project you like so that it can become a parachain. (A parachain is a custom, project-specific blockchain that integrates with the main Polkadot blockchain.)
From November 4, 2021, Binance is offering a $30 million Warm-Up bonus for those who stake their Polkadot in one click (spread among all participants). Not too shabby! You earn tokens from those projects that win in the auction, but this is sometimes a bit of a gamble, so be aware of that.
3. KuCoin
The KuCoin exchange was founded in Hong Kong and is mostly known for offering one of the world's most impressive and diverse trading pair selections. The platform currently has an impressive trading volume of $6.5 billion. It allows users to stake various crypto coins, including Polkadot, with daily rewards ranging between five and 14% of your staked amount. You also don't need to lock up your staked funds when doing this.
To stake in this way, you'll need to use Pool-X, a trading platform available to use on the KuCoin exchange. You can also stake your DOT via KuCoin's parachain slot auctions. There are currently a variety of different projects you can check out on KuCoin that are available to bid on. This works in a similar way to the parachain auctions held on Binance's exchange platform, but it is still important to remember that your project may not win, and you may not reap any rewards.
4. Lido (and Moonbeam)
Unlike the first three platforms listed here, Lido is not a crypto exchange. Rather, it's a liquid staking platform. In September 2021, the platform joined forces with Moonbeam, a Polkadot smart contract platform, and announced they'd soon be allowing users to stake their DOT funds.
Though you can't yet stake your Polkadot on using Lido and Moonbeam, it is believed the platforms will offer users a way to stake their DOT funds while also receiving liquidity for said funds. We'll have to wait and see whether these platforms live up to what they're promising users.
5. Bitfinex
Bitfinex is another popular trading platform, founded in 2012 as a peer-to-peer Bitcoin exchange. Since then, it has grown tremendously and has a considerable trading volume of around $1.7 billion. Bitfinex currently lets you buy and sell a range of different coins, including DOT. What's more, you can also stake your Polkadot funds on Bitfinex's platform.
You can gain rewards of up to 14% annually by staking your DOT on Bitfinex, and you don't need to pay any staking fees. However, Bitfinex does lock up your DOT tokens for the required staking period, so be aware of this. But the exchange claims your funds will be held safely in cold wallets (which are known to be considerably more secure than hot wallets), so you shouldn't need to worry about any accidental losses.
6. Polkadot.js
In short, Polkadot.js is a browser extension that manages your crypto accounts and transactions. It is not a cryptocurrency exchange or liquid staking platform, but it does allow users to stake DOT.
Polkadot recommends that you create two accounts: a stash account and a controller account. It is also advised that you have more than one DOT in your controller account and a small amount of DOT in your stash account. If you want to stake on Polkadot.js, you should expect returns of around 10% of your original staked tokens. Keep in mind that this is less than some other platforms offer, like Bitfinex or Kraken.
It's Easy to Stake Polkadot & Earn Passive Income
Every year, more and more platforms roll out support for Polkadot staking, and there's now a wide range of different sites to choose from. So, consider the platforms above if you want to stake your DOT. They're both well-known and secure and offer handsome returns for staking your funds.