Coinbase vs. Kraken staking: The biggest differences
Staking is a process that allows you to earn monetary rewards by locking up certain amounts of cryptocurrencies. You’ll usually need a minimum balance of the eligible cryptocurrency to begin earning rewards, and the cryptocurrencies you can stake generally vary by platform.
When it comes to staking, Kraken is the best choice for those in search of the highest rewards. Plus, the exchange offers staking for more assets than Coinbase, and it has a constant payout rate (twice a week) across all cryptocurrencies.
However, Coinbase is generally a better platform for beginners, and it’s great for those specifically looking to stake assets like algorand and dai.
Are Coinbase’s staking rewards right for you?
If you’re big on passively earning more crypto by simply holding onto balances for different assets, Coinbase’s staking program could be right for you. You can automatically earn annual interest with a few simple steps, and you’ll only need $1 to get started. However, both the reward amounts and payout rates vary per cryptocurrency.
It offers rewards for the following cryptocurrencies:
- Ethereum: 4.50% interest rate; daily payout rate
- Algorand: 4.00%; daily payout rate
- Cosmos: 5.00%; payout every seven days
- Tezos: 4.63%; payout every three days
- Dai: 2.00%; daily payout rate
- USD coin: 0.15%; monthly payout rate
Another thing to note is that you can stake existing crypto that you haven’t directly purchased through Coinbase. In other words, you can transfer cryptocurrencies from external crypto wallets into the Coinbase platform to stake if you need (the platform also charges $0 for these types of transfers).
If you’re wondering about the tax implications of staking, US customers must report any staking income they’ve earned. If you earn over $600 in staking, Coinbase will provide a 1099-MISC form.
Are Kraken’s staking rewards right for you?
Kraken also offers a vast suite of staking rewards for cryptocurrencies. Like Coinbase, it supports ethereum, cosmos, and tezos. But unlike Coinbase, Kraken also allows staking for bitcoin, polkadot, kusama, flow, US dollar, Euro, kava, solana, and cardano. Plus, regardless of the asset you’re staking, it pays you rewards twice a week.
Out of the 12 assets Kraken supports for staking, nine of them are on-chain. Three — Euro, US dollar, and bitcoin — are off-chain. On-chain assets rely on Proof of Stake blockchain agreements, while off-chain assets allow you to utilize the exchange’s internal computer programs.
Its staking rewards apply to the following cryptocurrencies:
- Polkadot: 12%
- Kusama: 12%
- Cardano: 4-6%
- Flow: 4.6%
- Ethereum: 5-7%
- Solana: 6.5%
- Cosmos: 7%
- Tezos: 5.5%
- Kava: 20%
- Euro: 1.5%
- US dollar: 2%
- Bitcoin: 0.25%
And as with Coinbase, you can also stake assets via two ways on Kraken: (A) Buy cryptocurrencies directly from the platform, or (B) transfer existing cryptocurrencies from any external wallets.