Many tokens can be staked, but the most popular among these are BNB tokens. You can stake your BNB to earn extra money and rewards. Rather than just keeping your tokens in a cold storage crypto wallet, you can Stake BNB to have additional income each year. This article is a step-by-step guide on how to stake your BNB tokens and earn rewards.
Stake BNB: A comprehensive guide about staking and related processes
Staking is one of the most popular methods to earn additional income. Decentralized exchanges offer their users to stake their tokens in order to achieve more. Many tokens can be staked, but the most popular among these are BNB tokens. You can stake your BNB to earn extra money and rewards. Rather than just keeping your tokens in a cold storage crypto wallet, you can Stake BNB to have additional income each year. This article is a step-by-step guide on how to stake your BNB tokens and earn rewards.
Staking tokens is super easy. However, selecting the right token for staking is a difficult task. You need to research the rewards associated with different tokens and how long it takes to get that reward. You also need to focus on market cap, future devaluation, token stake value, and other factors.
There are different rewards for different tokens. BNB tokens provide the best possible bonuses in this genre of investment. You can start from 0.05 BNBs, and there is no upper limit for staking these tokens. You can earn from 5% to 8% daily income based on your tarrif plan.
What is staking?
Suppose you are a crypto investor, then you have heard a lot about crypto staking. However, it is necessary to grasp the whole concept before jumping into the staking market.
Staking is the way through which many cryptocurrency transactions are verified. If you want to earn profits on your crypto holdings, it is a great way to make extra money.
Staking is a similar process to mining, and it means actively taking part in the transaction validation on a proof-of-stake blockchain. Anyone with the minimum required balance of a specific cryptocurrency can validate transactions and earn staking rewards.
- Staking is an easy way to earn interest on your cryptocurrency.
- Staking is environmentally friendly than crypto mining.
- No equipment is required for crypto staking. like you would for crypto mining.
- You maintain the security and efficiency of the blockchain.
How do I start staking BNB?
Staking is generally open for everyone. If you want to participate, you only need BNB coins. You can start with even 0.5 BNBs. However, becoming a full-time validator is not easy, and you need a substantial investment.
This minimum investment will enable you to contribute as a full-time validator in the blockchain of your token. Along with the investment, technical knowledge of the market and a dedicated computer is also necessary to perform validations 27/7.
Being a full-time validator comes with responsibilities. You are becoming a part of a decentralized economy. It comes with serious obligations. Any downtime can cause a delay in the process, and the stake of the validator can be slashed.
Technicalities of staking
Redelegation refers to the withdrawal of tokens. Users can withdraw their tokens if the current validator is not performing. It is also possible in the case if there’s some other validator who is offering higher rewards.
You just need to press the redelegate button and change the current delegated to your desired delegator to redelegate. However, it does not allow investors to divide their amount between different delegators. It means that all your BNB tokens from your current delegator will go to the chosen one.
Unstaking BNB tokens are also easy. Users can unstake BNB tokens at any time they want. However, there are different locking periods on various platforms. After unstaking your tokens, you need to pass through that locking stage, and after that locking stage, you will get your tokens in your safe crypto wallet.
The process of unstaking BNB tokens is straightforward. Users just need to press the unstake button, fill in the amount they want to unstake, and that's it. The other main point in unstaking BNB tokens is the validators. If you have staked your token to more than one validator, then you must select the validator from which you want to unstake your tokens.
Pros and cons
If you are an investor and want to invest long-term, then BNB staking is the best option you can go for. However, there are certain pros and cons of staking you should keep in mind before giving it a try.
As we know, cryptocurrencies are different from fiat currencies, so different type of cons are also there.
Following are few pros and cons of staking crypto.
|Environment friendly||Liquidity risk|
|Great way to earn passive income||Validator risk|
|Helps in making blockchain secure||Lock up periods|
|No need to costly equipment|
Advantage of staking
Staking works in favor of Long-term crypto holders in many ways. The long-term BNB token holders can use this opportunity to generate more funds out of their crypto. They can earn more rewards and be a part of a much larger and more credible community. Rather than collecting nothing from your BNB token that is lying in your crypto wallets, you can earn much out of them.
Staking BNB has additional benefits. You can contribute to making blockchain more persistent and prone to attacks by using your tokens to strengthen the transaction process. You can add value, security, and efficiency to this project from your end.
Following are some advantages and disadvantages of crypto staking
- Passive income
- Active participation in blockchain
- Become part of your community
- Add to the security and efficiency
1. Safe and secure channel
You already know how volatile the crypto market is!
Do not fall prey to fancy slogans that talk about becoming rich in days. The real world does not work like that. Being an investor, you must work hard and devise your strategy. You need to do your research and decide in which direction you need to invest your funds.
Everyone who slightly knows the crypto market will understand that staking is the most secure way to earn in the crypto market. Your stake will remain intact, and you will profit from facilitating transactions by staking your tokens and letting the system use them as a reference point to generate more tokens and validate them.
2. Earn Passive income
If you bought BNB tokens as a long-term investment, it is the time to safely utilize those tokens rather than keeping them in a safety wallet and collecting dust. Stake your BNB stocks and earn a great reward by contributing to the security and authenticity of a blockchain.
You can earn daily profits without worrying about anything. Your tokens will be a reference point to validate other transactions. In this way, you can even earn "Governance Tokens" as a staking participant. These premium tokens are awarded to those participants in return for their services to strengthen the blockchain of BNB. Having a governing token lets, you have a say in any change in the token's protocol or system upgradation.
Why only a few currencies for staking?
Only a few cryptocurrencies can be staked. This is where the process becomes more technical. For example, Bitcoin does not allow staking. To understand the process, we need to get some background knowledge.
Cryptocurrencies are decentralized currencies. It means that there is no central authority to control the price. Then how did all the computer networks in a decentralized environment reach a correct answer for successful transactions without a central authority such as banks and credit-card-services? The answer is that they use the "Consensus Mechanism."
Many cryptocurrencies, such as Bitcoin and Ethereum, use a consensus mechanism known as "Proof of Work," through which the legitimacy of every new transaction is validated in the blockchain. On the other hand, some currencies that work on more complex mechanism operates through staking, where every coin staked by the owner is used as a reference point or a guarantee of the legitimacy of new transactions.
Staking BNB on Binance is exceptionally beneficial for people thinking of a long-term investment. You can use different online platforms to bet your BNBs. However, Binance is the most suitable exchange you can choose because BNB is the token of Binance, and they facilitate staking to ensure secure transactions and fast transmission of funds.
If you want to have passive income through your purchased BNBs, there is nothing better than staking your tokens. However, you must have proper or at least basic knowledge of the field and market. A superfast computer is also a must to ensure the continuity of the process.
A minimum balance is also required for staking. Users must keep at least 1 BNB in Binance. The platform also has a locking period of seven days. You cannot withdraw your BNB before that. You can enjoy the staking facility from your Trust Wallet.
1. Can we make money by staking?
Yes, we can make money by staking our BNB tokens. It is a simple yet effective method to earn passive income and become an active member of the crypto market.
2. What is the risk of staking crypto?
There are more rewards than risks in staking. The risks are so low that we can neglect them. If you are a small-level validator, you need not worry. You can securely stake your BNBs using Binance.
3. Does cryptocurrency increase while staking?
The market decides the value of the cryptocurrency. The value of your tokens will still be connected with the market. However, the reward you get can be considered extra money or revenue. Your actual number of tokens will not increase in the process.
4. Is staking available in the US?
Yes, staking is available in the US. It is also available in most countries around the globe and also you can stake on Binance US