Scope
- What is crypto staking?
- How do platforms do it?
- Top platform
- FTX
- Flint
- Binance
- Pillow fund
- Kucoin
- Nexo
- BlockFi
- Their USP like a 10% return
- Who offers max interest like flint offer 10%
- Funding n valuations with founders
What is crypto staking?
Crypto staking is a way in which traders or investors earn rewards for holding certain cryptocurrencies. Staking as the name suggests, is an incentive that blockchain provides to anybody who is holding it. By holding it, the investors usually earn passive income without the need of selling it.
How do platforms do it? Or how does it work?
If the cryptocurrency that you’re holding allows an option of staking, you can stake some of your holdings and earn a reward as a percentage over a while. It is available for coins like Ethereum, tezos, cosmos, etc. it is similar to that of interest-bearing savings accounts except that cryptos are risky. The reason why investors can earn rewards on some cryptos is that the blockchain puts the crypto to work. Some cryptocurrencies that allow staking use something called a “staking mechanism” also known as proof of stake wherein the crypto is used for ensuring that all the transaction is verified and secured without any intermediate process also known as a middleman. If you choose to stake the crypto, it automatically becomes part of the process in the blockchain.
Top platform
Flint- it is backed by sequoia and coinbase venture. It allows users to convert fiat or cryptocurrency into a stablecoin such as USDT. It loans the amount to either hedge funds or any exchanges by over-collateralizing it and generating the returns with the help of marginal trading.
FTX- this platform also supports staking of crypto however for using that, trading needs to be enabled.FTX raised $900 million at an $18 billion valuation from over 60 investors, that includes Softbank, Sequoia Capital, and other firms.
Binance- the staking feature is now available on Binance but only for US customers holding crypto. Binance Coin (BNB), Solana (SOL), Avalanche (AVAX), Cosmos (ATOM), The Graph (GRT), Livepeer (LPT), and Audius (AUDIO) are among the cryptos paying high yields. Binance has made 3 acquisitions and 55 investments. The company has spent over $ 400M on acquisitions. The latest acquisitions are, CoinMarketCap (Mar 2020), JEX (Sep 2019), and Trust Wallet (Jul 2018).
Pillow fund- it generates a high yield on cryptos by creating De-Fi investment and executing investment strategies. De-Fi pillow raises $3 million by elevation capital.
Kucoin- it allows users for staking a coin without any lock-in period. This is done through a mechanism called soft staking. KuCoin announced $20 million (USD) round A funding from IDG Capital and Matrix Partners. In 2021, Forbes Advisor named KuCoin as one of the Best Crypto Exchanges.
Nexo also supports crypto staking wherein users can earn interest on specific cryptos. The interest varies from one crypto to another depending upon the risk. The latest funding round was for $7 million, Seed Round – Kaleidoco.
BlockFi- supports staking for the following cryptos, BTC, ETH, LTC, PAXG, USDC, USDT, GUSD, and PAX.
But how they’re different?
Flint – 13% per annum
FTX- 8% per annum
Binance – 36.79% per annum
Pillow fund- 13.68% per annum
Kucoin – 20% per annum
Nexo- 17% per annum
BlockFi- 8.6% per annum
Who offers max interest like flint offer 10%
Binance – 36.79% per annum which is the maximum as compared to all the existing platforms out there. This is due to the high-risk, high-yield paying cryptos like BNB, GRT, ATOM, etc.
Funding n valuations
Flint – Flint has raised a total of $5.1M in funding over 1 round. This was a Seed round raised on Jan 25, 2022, raised by Sequoia Capital India and GFC.
FTX- according to a report, FTX is targeting a funding round at the same valuation as the $32 billion valuation (last round), when it raised $400 million. Akshit Bordia and Anshu Agrawal are the founders. According to the Bloomberg report, FTX is reportedly considering an acquisition of the trading platform Robinhood for expansion.
Binance- It has raised $50 million in funding at a $4.5 billion valuation. The founder is Changpeng Zhao.
Pillow fund- De-Fi pillow raises $3 million by elevation capital at a valuation of $12 million. Arindam Roy, Rajath KM and Kartik Mishra are the founders.
Kucoin – KuCoin announced $20 million (USD) round A funding from IDG Capital and Matrix Partners at a valuation of $150 million. The founder is Johnny Lyu.
Nexo- It has raised a total of $27M in funding at a valuation of $99 million. Antoni Trenchev is a co-founder and managing partner of Nexo.
BlockFi- has raised a total funding of $1.4B at $3B in valuation. The founder is Zac Prince.
