Elliott is a British cryptocurrency journalist and copywriter. Having spent the past couple of years immersed in everything crypto, he now spends his time researching…
Since Ethereum’s “Merge” event in 2022, staking has been one of the top ways to compound crypto by earning passing rewards. However, knowing where to stake crypto with robust security and the highest annual percentage yield (APY) can be tricky.
This article provides our picks for the best Ethereum staking platforms, taking into account security, APY, lock-up period, payout frequency, ease-of-use and more.
Top 6 Ethereum Staking Platforms Ranked
Here are our top four picks for the best Ethereum staking platforms, along with what makes them stand out.
Margex – High-yield staking platform with leveraged trading up to 100x. Offers an impressive 4.7% APY on ETH staking with MP Shield technology for protection against price manipulation.
Binance – World’s largest crypto exchange offering ETH staking with 3.16% APY. Features unique “Principal Guaranteed” option ensuring the protection of original investment.
KuCoin – Versatile staking platform ideal for short-term investors, offering 3.7% APY on ETH with no minimum requirements. Offers a quick 5-day redemption period.
Nexo – User-friendly staking platform offering customisable yields and liquid staking. The platform offers 50% LTV on NETH and instant withdrawals. The platform provides a generous ETH staking yield of around 4%.
Lido – Decentralised liquid staking solution with 3.8% APY on stake ETH, enabling users to earn multiple yields. The Lido protocol’s governance is decentralised, with the $LIDO token used to vote on proposals.
Rocketpool – Decentralised staking solution with permissionless validators and a synthetic ETH, which gradually accrues value. Its synthetic token, rETH, may provide a more tax-efficient alternative to Lido’s rebasing solution, which may trigger taxable events depending on your jurisdiction.
Reviewing the Best ETH Staking Platforms
Next, we will review each platform in closer detail, highlighting its key features, pros and cons.
1. Margex – High-Yield Staking Platform Offering Up To 100x Leverage With 4.7% ETH APY
Margex is currently #1 on our list of the best Ethereum staking platforms. It offers a flexible platform that combines staking with high-leverage trading—where users can earn passive income from staking while trading the staked assets with up to 100x leverage.
It’s also highly secure and offers an ‘MP Shield technology’ that protects users from price manipulations. At press time, it offered a nearly 4.7% APY on Ethereum staking, slightly higher than the 3% that most competitors offer.
Margex does not lock your staked coins, so you can trade them whenever you want. It offers this flexibility by using the staked coins as collateral. This, along with liquidity partners, makes it possible to offer zero-interest loans.
The combination of staking and trading allows users to leverage their assets without typical restrictions. The platform also offers advanced tools for experienced traders— allowing integration with trading bots and systems. It also supports staking for other cryptos, including popular cryptos like Bitcoin, USDT, and USDC.
It’s worth noting that Margex has a referral program where you can earn money by inviting others.
Staking Rewards
4.7% (but varies).
Lock-In Period
None
Payout Frequency
Daily
Pros
High leverage trading up to 100x
Secure with MP Shield technology
No lock-in period for staked coins
Flexible staking and trading
Cons
Limited staking options compared to other platforms
Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong.
2. Binance – World’s Largest Exchange Providing Principal-Guaranteed ETH Staking At 3.16% APY
Another popular Ethereum staking platform to consider is Binance. It’s the biggest crypto exchange in the world that allows you to create an account in just a few minutes, deposit or buy ETH and start the staking process.
The platform offers a staking APY of nearly 3.16% on Ethereum at the time of writing. While this rate is lower than some other Ethereum staking platforms, Binance has a special feature called “Principal Guaranteed.” This makes sure that you will get your original principal back (no interest). This feature is extremely crucial in the case of market crashes.
You can get your ETH coins back after the staking term is over. If you’re looking for more flexibility, Binance also has Ethereum savings accounts with an APY of 1.01% that lets you withdraw money whenever you want.
The Binance staking service is easy to use, so it’s suitable for all kinds of traders. The platform also offers other ways to make more passive income—like liquidity farming and dual investing.
Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong.
3. KuCoin – Short-Term Staking Option With Quick 5-Day Redemption and 3.7% ETH APY
Kucoin is another popular Ethereum staking platform for short-term investors. It currently offers an APY of 3.7% for ETH staking, and there are no minimum requirements or limits on how much you can stake.
The platform is known for its relatively short staking period. For instance, staked ETH can be redeemed in just five days.
KuCoin also provides liquidity during the staking period by issuing ksETH on a 1:1 ratio with ETH. Please note that this is backed up by audited proof of funds to ensure transparency.
KuCoin Earn offers a variety of interest-bearing rewards— such as promotions, savings accounts, and staking. The current interest rate for Ethereum 2.0 staking is almost 4.7% annually. You can also stake stablecoins like Tether (USDT) and USD Coin (USDC) to earn more passive income.
However, it’s important to note that KuCoin isn’t licensed in the U.S., so accessing the various features of KuCoin Earn can be a problem for U.S. users.
Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong.
4. Nexo – User-friendly Staking Solution With Liquid Staking and 4% APY
Nexo is an all-in-one crypto exchange offering over 500 cryptos and many additional products and services, including ETH staking.
The platform’s slick user interface and daily Ethereum staking rewards make it a contender for one of the best crypto staking platforms.
With customisable yields of around 4% (up to 12%) and instant withdrawals, Nexo has quickly become one of the top ETH staking platforms.
Users who stake ETH with Nexo gain a synthetic NETH in return. Nexo will then allow them to take out a crypto loan using the NETH as collateral with a 50% loan-to-value (LTV) ratio, leading to endless new ways to earn on staked ETH.
As well as a high ETH yield, Nexo offers generous APY of up to 16% on other cryptos. According to Nexo’s document, it combines staking rewards with rewards from MEV and Ethereum network fee activity to maximise users’ yield.
Nexo facilitates staking on over 35 different crypto assets and operates in over 200 jurisdictions. Moreover, the platform boasts industry-leading security and is backed by institutional insurance to protect against losses.
Staking Rewards
It varies but around 4%.
Lock-In Period
No lock-in period
Payout Frequency
Daily
Pros
Offers a high APY.
50% LTV on NETH.
The platform is backed by insurance to protect against losses.
Cons
Ethereum staking is unavailable in the US, Canada, Australia and other countries.
5. Lido – Decentralised Liquid Staking Solution Enabling Users to Earn Multiple Yields From Staking ETH
Lido is a liquid staking solution offering users a notable Ethereum staking yield and provides a synthetic version of the token, which they can use to earn extra yield.
Currently, Lido offers liquid staking on Ethereum, Solana and Polygon. Its Ethereum staking currently provides a 3.8% APY, Solana is 7%, and Polygon is 4.3%.
After staking Ethereum on Lido DAO, users receive a synthetic version of the token, stETH. They can then put this token to work in over 100 dApps to earn an extra yield on top of the 3.8% APY.
Some applications that users can generate extra yield on their stETH include 1inch, AAVE and Balancer.
Staking Rewards
3.8% (but varies depending on the total amount of ETH staked).
Lock-In Period
No lock-in period
Payout Frequency
Daily
Pros
Users can earn multiple yields on their ETH through liquid staking.
Respectable APY of 3.8% on ETH.
Highest TVL of all decentralised staking solutions, adding to its network effect and bolstering its security.
6. Rocketpool – Decentralised Staking Pool With Permissionless Validators and Non-rebasing Liquid Token
Rocketpool is a decentralised staking protocol established in 2016. Initially, it focused on traditional staking but later incorporated liquid staking, offering users a non-rebasing liquid ETH in return for staking their coins.
Since Rocketpool’s rETH is non-rebasing, its value gradually climbs over time, so rETH costs more than ETH. Depending on your jurisdiction, this may prove more tax efficient than stETH.
One of the main draws to Rocketpool is that it is permissionless to operate a node. Consequently, anyone can run a node on the network, making it more decentralised.
Rocketpool’s seven-day average Ethereum staking APY is 3.27%, equal to that of Coinbases. However, thanks to Rocketpool’s rETH token structure, simply holding rETH means you are staking ETH and will earn this yield.
Another benefit to Rocketpool is that there is no staking lock-up period, meaning you can withdraw your tokens anytime.
Staking Rewards
3.27% (but varies depending on the total amount of ETH staked).
Lock-In Period
No lock-in period
Payout Frequency
Daily
Pros
More decentralised than Lido DAO.
The rETH token is potentially more tax efficient than other liquid ETH tokens.
Ethereum staking is a way to secure the Ethereum network using ETH coins.
Ethereum’s 2022 “The Merge” event, also known as Ethereum 2.0, switched the network from a “Proof-of-Work” (PoW) consensus mechanism to a “Proof-of-Stake” (PoS) mechanism.
This means that for nodes to record and validate transactions, they must risk financial collateral rather than energy.
While both PoW and PoS ultimately rely on financial risk to secure a network, PoS does so in a more environmentally friendly way, albeit at the potential cost of increased centralisation and slightly lower security.
To begin validating transactions, Ethereum validators must “stake” cryptocurrency (or deposit it into an Ethereum smart contract). If the validator is found to have acted maliciously, some of its stake will be seized in a process known as “slashing”.
The purpose of this is to incentivise validators to act with good intentions.
Furthermore, validators are financially incentivised with staking rewards resulting from a combination of gas fees and a portion of ETH emissions.
How Does Staking Ethereum Work?
As mentioned, Ethereum relies on network validators to store and validate transactions. However, validating transactions on Ethereum is expensive for the average user. It requires high-quality validating hardware, and the user must stake a minimum of 32 ETH to get started.
Even with 32 ETH staked, three is no guarantee that the validator will be selected to validate blocks regularly; this means the rewards may be inconsistent. As a result, many validators choose to join what is known as a “staking pool”. This is where multiple validators combine their resources to receive more steady and predictable rewards.
Each staking pool member will receive rewards proportional to their pool share.
However, this raises the question of how Ethereum holders with less than 32 ETH can stake their coins.
How to stake Ethereum with under 32 ETH
People who want to stake Ethereum with less than 32 ETH are delegators rather than validators.
Simply put, a delegator will deposit their coins with a validator who will stake and earn block rewards on the delegator’s behalf. Usually, the validator will charge a small fee for doing so.
Most people who choose to stake ETH on one of the six best Ethereum staking platforms discussed above will be delegators, with the platform itself handling the network validation.
This provides a more hands-off approach to earning rewards, although delegators must sacrifice a small amount of rewards in return.
The APY validators generate ultimately depend on the total amount of ETH staked and in proportion to their Ethereum staking pool size. If the amount of staked ETH decreases on the network, they will earn a higher APY.
Benefits of Staking Ethereum
Many reasons exist to stake ETH, from financial incentives to ensuring a more robust and decentralised financial system. Let’s take a look at them below.
Potential to Compound Growth
As we have discussed, staking crypto means you can earn passive rewards. However, this is only part of the benefit of ETH staking rewards. The other advantage is compounding gains. Think about it, while 4% of APY on staked ETH may not seem much today, if ETH’s price increases, so does that reward.
For example, suppose the ETH APY was 4%, and then ETH did a 5x; this would equate to a 20% APY gain rather than 4%, plus the additional APY from other years. Moreover, the actual staked ETH would also have seen significant gains in this scenario, adding to the compound effect.
Bolster Ethereum’s Security
As we mentioned, the more ETH staked, the lower the rewards. This is because validating becomes more competitive as the amount of staked ETH increases. While this may reduce earning potential, it means the network’s security is increasing.
The reason is that the more ETH that is staked, the harder it would be for a bad actor to overpower the network by controlling the majority of staked ETH.
More Environmentally Friendly
PoS is a more environmentally friendly alternative to PoS. Consequently, staking Ethereum is a far more eco-friendly way to support blockchain decentralisation than mining Bitcoin. This benefit was also discussed in our BTC20 price prediction, where we highlighted that its staking mechanism is environmentally superior to Bitcoin’s mining mechanism.
Is Ethereum Staking Worth it?
Several factors must be considered when deciding whether Ethereum staking is worth it.
Firstly, you must consider the risk of the underlying asset, Ethereum. Despite the APY that staking offers, your portfolio could still lose value if the price of Ethereum drops. That said, if you are HODLing anyway, the Ethereum staking rewards may offset some of the losses if it goes down.
The second risk to consider is staking risk. This ranges from slashing and other penalties to smart contract risk. If you or the entity you delegated to breaks Ethereum’s rules, some of your stake may be slashed as a punishment.
Moreover, there remains a possibility that your validator could get hacked or attempt to steal the funds.
We have already discussed the benefits of staking in the section above, so it is ultimately up to the individual investor whether ETH staking is worth it. However, the risks are minimal if you already hold ETH and stick with a reputable staking platform.
Do You Pay Tax on Ethereum Staking?
For most jurisdictions, the simple answer to this question is yes – any profits earned from cryptocurrency are subject to taxation. However, the exact rules and regulations may differ depending on your location, so it is important to contact a local tax professional for proper guidance.
When it comes to staking ETH, these profits are generally attributed to income tax. This means that you will owe taxes on them based on their value when you receive them.
However, as mentioned earlier, some protocols like Rocket Pool provide a synthetic token that accrues value over time. In this scenario, you may owe tax in the form of capital gains only when you dispose of the asset and realise profits.
Still, consult a local tax specialist to avoid penalties and ensure you comply with all regulations.
Is Ethereum Staking Safe?
When staking Ethereum, it is natural to be cautious of the potential risks. These risks span from smart contract risk all the way to centralisation risk.
Once you have deposited your ETH into its PoS smart contract, it is no longer in your custody and could be stolen by a hacker. While this does present smart contract risk, this risk would be much greater reaching than just the funds lost to the hack.
It would also cause the ETH price to crash, so even unstaked ETH in self-custody would be at risk in this scenario. Also, it is important to mention that Ethereum has some of the most robust security on the market.
Another risk to consider is slashing and other penalties. While you may not face these issues with reputable brokers, some lesser-known staking platforms may go against Ethereum’s rules for their own gain, risking their delegator’s funds in the process.
As mentioned, Ethereum also faces a centralisation risk regarding its PoS mechanism. While this may not directly affect the security of your staked funds, it is worth being aware of as it could increase regulatory pressure on staking platforms in the future.
Nevertheless, despite Ethereum 2.0 staking being a relatively new concept, it has proven to be a robust method of earning passive rewards, particularly for those who stick with a proven staking platform.
Conclusion
Like everything in crypto, staking carries risk. Nevertheless, the passive rewards offered on one of the top-performing assets in recent years provide a viable way to compound crypto gains.
Currently, Margex is the best staking platform on Ethereum. It offers quite a staking reward of 4.7% and has a long legacy of being one of the most secure and regulatory compliant exchanges.
Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong.
Deciding whether or not to stake Ethereum is ultimately the individual investor’s decision. However, if you already hold Ethereum as part of your portfolio, the additional risk of staking it is minimal, provided you use a reputable staking platform. As a result, the rewards earned from staking ETH may make it worth it for many holders.
How much do you make staking Ethereum?
While the ETH staking APY varies depending on the method you use to stake, you can expect to earn between 3-4% APY by staking Ethereum.
Is staking eth risky?
While there are several risks to staking Ethereum, such as smart contract risks, exposure to price volatility and centralisation risks, you can reduce the potential damage of these risks by using a reputable staking platform and only investing what you can afford to lose.
Can you live off of eth staking?
While it is possible to live off ETH staking, you must also consider the cyclical nature of the crypto markets, so it may not be sustainable unless your staking rewards far exceed your expenditure. For example, Ethereum is currently trading 62% lower than its ATH. This means you would be earning 62% less rewards (in USD value) now than at its 2021 peak.
What are the best Ethereum staking platforms?
Currently, the top Ethereum staking platform is Margex. It’s a highly reputable platform offering 4.7% APY on staked ETH, along with being one of the most user-friendly Ethereum staking platforms on the market.
Elliott is a British cryptocurrency journalist and copywriter. Having spent the past couple of years immersed in everything crypto, he now spends his time researching the most impactful cryptocurrency trends. He looks for projects with long-term visions and is a huge believer that blockchain technology can solve the world's most pressing issues.
