How to earn crypto rewards
From staking to lending, some of the best ways to grow your crypto
- How to get rewarded crypto?
- How do I get $200 free on Coinbase?
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New and exciting opportunities have arisen as the cryptocurrency world keeps growing, allowing you to earn cryptocurrency rewards just by using decentralized finance (DeFi) platforms, learning about blockchain technology, or holding digital assets. These rewards are now more accessible than ever, regardless of your level of experience with cryptocurrency.
A seamless and intuitive experience is provided by the majority of these earning options, which are integrated directly into the Coinbase main app or website. You may require a wallet that supports an integrated DeFi browser, like the Coinbase Wallet, for more complex options, particularly those involving DeFi. We’ll outline some of the best strategies for increasing your cryptocurrency holdings through tangible, usable gains below.
Please note: this guide is not intended for users in the UK, and some of these reward opportunities may not be available in that region.
How to Earn Crypto Rewards Through Staking
Nowadays, a growing number of cryptocurrencies are switching to a mechanism known as “Proof of Stake,” which enables their networks to secure and validate transactions without the assistance of banks or other conventional payment processors.
You can get cryptocurrency rewards with Proof of Stake coins simply by contributing to network security. How? Staking entails locking a portion of your cryptocurrency holdings into a staking pool for a predetermined amount of time. You’re supporting the network while your cryptocurrency remains there. Regular rewards are given to you in exchange. This is a wise move, particularly if you intend to keep your cryptocurrency for a long time. Staking puts your assets to work rather than letting them sit around doing nothing.
If you’re using the Coinbase app or website, eligible users can currently stake popular assets like Tezos, Cosmos, and Ethereum (ETH). Depending on the specific cryptocurrency, you could earn up to 6% APY as of June 2021. To explore staking options and start earning, visit coinbase.com/staking.
How to Earn Crypto Rewards Without the Volatility
One of the challenges with earning crypto rewards through traditional staking is that your earnings are paid out in the native cryptocurrency — and prices can swing wildly. This volatility might not be ideal if you’re looking for more stable returns.
But here’s some good news: You can earn crypto rewards just by holding stablecoins like Dai and USD Coin (USDC), which are pegged to the US dollar and designed to maintain a steady value.
For example, as of June 2021, simply keeping Dai in your Coinbase account can earn you 2.00% APY. If you hold USDC, you can earn 0.15% APY — and there’s even more earning potential if you use USDC Lending (see tip No. 4).
Lend some of your crypto with CeFi
Want to keep your money steady while earning cryptocurrency rewards? The returns on traditional savings accounts are frequently low, but stablecoins are revolutionizing the market. With cryptocurrency, you can now earn competitive yields without the typical volatility. Platforms for centralized finance (CeFi) are growing and present alluring chances for users to profit from cryptocurrency just by owning stablecoins. For instance, Coinbase customers can now earn 4.00% APY on USDC, which is a great choice for investors who don’t want to take on too much risk. However, bear in mind that neither the FDIC nor the SIPC insure cryptocurrency deposits.
Lend some of your crypto with DeFi apps
You might want to look into earning cryptocurrency rewards through DeFi (Decentralized Finance) platforms if you’re willing to assume a little more risk in exchange for the possibility of larger returns. Since DeFi is still in its infancy, it’s crucial to test the waters with only money you’re willing to lose.
Peer-to-peer lending through DeFi platforms is transparent and has the potential to yield higher returns than traditional financing. You can receive cryptocurrency rewards from borrowers in the form of interest by providing your cryptocurrency to these lending protocols. You’ll need a cryptocurrency wallet that supports DeFi apps in order to get started; Coinbase Wallet is a good choice. It is accessible to everyone, not just Coinbase users, and differs from the Coinbase main app.
With Coinbase Wallet, you can dive into DeFi lending by starting with a stablecoin — this is often the easiest way to begin. Popular DeFi protocols like Compound or Aave make it simple to lend your crypto and start earning crypto rewards in return.
FAQs
1. Q: What is crypto staking and how can I earn through it?
A: Staking lets you lock up cryptocurrencies that use Proof‑of‑Stake (like Tezos, Cosmos, or Ethereum) to help secure their networks. In exchange, you earn staking rewards (up to ~6 % APY as of June 2021) right on Coinbase.
2. Q: Can I earn interest just by holding stablecoins?
A: Yes. Holding dollar-pegged stablecoins like DAI or USDC can earn you passive rewards. For example, as of June 2021, DAI yields ~2 % APY and USDC ~0.15 % APY on Coinbase .
3. Q: What does lending via centralized finance (CeFi) mean?
A: CeFi platforms let you lend your crypto (especially stablecoins) on centralized services. Coinbase users could earn around 4 % APY on USDC, though note deposits aren’t FDIC/SIPC insured .
4. Q: How can I earn more via decentralized finance (DeFi) lending?
A: By using a DeFi-enabled wallet (like Coinbase Wallet), you can supply crypto to DeFi lending protocols like Compound or Aave. Returns are potentially higher, but risk is also greater .
5. Q: What are the risks involved in these reward‑earning methods?
A:
Price volatility: Rewards in crypto tokens may fall in value if the token price drops.
Platform risk (CeFi): Centralized platforms may face liquidity, security, or regulatory issues—and stablecoin deposits aren’t insured.
Smart contract risk (DeFi): DeFi protocols are experimental and could fail or be hacked. The blog advises not investing more than you’re willing to lose
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The Bottom Line
A clever and convenient method of increasing your digital assets without engaging in active trading is through cryptocurrency rewards. Earning cryptocurrency can be profitable and instructive, whether through staking, cashback, learning programs, or holding particular tokens. As with any investment, it’s critical to comprehend the risks involved and select reliable platforms, such as Coinbase, to guarantee security. Let your cryptocurrency work for you, start small, and remain informed.
