06.12.2021

How you can make money storing your cryptocurrency: landing page and staking

Over the past month, the price of bitcoin has risen by more than 50%. But buying a cryptocurrency is not the only way to get income from digital assets, writes RBC Crypto.

Lending

Landing page is a way of passive earnings, which involves the temporary transfer of cryptocurrency at interest. A crypto investor lends either to exchanges (and due to this they increase liquidity), or to individuals. The transferred funds are blocked in the smart contract.

For example, on Binance, the largest cryptocurrency exchange in terms of trading volume, there are two types of landing pages:

  • Perpetual contract. It has a low interest rate, but funds from such a contract can be withdrawn or added at any time;
  • Fixed contract. Usually set for a certain period of time (10, 15, 30 days, etc.). Has a higher interest rate. Funds from such a contract cannot be withdrawn before its expiration.

Binance users have the option to invest cryptocurrency in a perpetual contract using USDT stablecoins. The interest rate on such a deposit will be 1.2% per annum. Higher interest rate – 3.3% per annum for the 1Inch token perpetual contract.

Axie Infinity Fixed Token Contract (AXS) offers 15% per annum. But the funds invested in the contract will not be available for 14 days. Perpetual landing page in USDT stablecoins at 9.3% per annum is available on the BlockFI decentralized platform. The Celsius Landing Platform provides a fixed contract for Ethereum at 5.3%.

Stacking

Staking is a way of passive earnings in which users store coins on the Proof of Stake (PoS) algorithm, ensuring the health of the blockchain. This gives the holders the right to profit. This option is only available to cryptocurrencies that run on PoS, such as EOS, Tezos, TRON and Cosmos.

The point of staking is to ensure all operations on the blockchain and support the network. For this, holders of digital coins receive a reward. The more tokens a holder has, the more likely he is to become the creator of a new block.

The use of staking depends on the strategy of the crypto investor, explained Nikita Zuborev, senior analyst at Bestchange.ru. According to him, if the holder of an asset is willing to put up with the inability to sell it for a long time, then staking will become an additional source of income.

“In medium and long-term strategies, you can receive additional funds for your open positions, which looks very interesting against the background of the traditional financial market. This strategy turns the purchase of altcoins into an alternative to bonds, with their accumulated coupon yield, ”the analyst noted.

According to Zuborev, staking can bring in from 3% to 15% per annum. The most promising for staking are tokens that have a medium-term trend towards an increase in the rate, otherwise the additional emission of coins will not even help cover the exchange rate difference, the expert says. Therefore, first of all, you need to pay attention not to the staking percentage, but to the stability of the growth trend in the value of the token, he added.

The most interesting tokens for staking can be: EOS (EOS), Stellar (XLM), Cardano (ADA), TRON (TRX) and Tezos (XTZ), Zuborev said.

“Staking can be called a full-fledged alternative to bank deposits or bonds. This is a conservative tool that, in some strategies, allows to reduce risks, ”the analyst emphasized.

According to him, the risk depends on the choice of the asset class and the type of blocking of funds. For example, staking volatile altcoins with a fixed lock for a long time will have the maximum risk, while staking stablecoins with a flexible lock will be minimal, the expert added.

EOS staking is available on the Binance exchange for 30, 60 and 90 days. Staking returns are 4.2%, 4.6% and 6.1%, respectively. Crypto exchange Huobi Global offers TRON (TRX) staking at 7% per annum. Cosmos (ATOM) staking is available on Coinbase with an interest rate of 5% per annum.

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