Coinbase Exchange has long been known for the Coinbase Learn and Earn program. With the Lean and Earn program, you watch videos on a crypto asset before answering simple video-based questions. In exchange for getting the right answers, you earn a small amount of cryptocurrency. Coinbase Learn and Earn isn’t the only way to get free cryptocurrencies on Coinbase, as the platform also offers Coinbase Earn, which allows you to bet on specific crypto assets and receive a return.
Coinbase allows you to bet on Ethereum, Cosmos, Algorand, Cardano, Solana, and Tezos. The annual returns on the staking of these assets range from 2-6% APY depending on the asset. If you’re wondering how to target crypto with Coinbase, you’ve come to the right place. In this guide we will give you step-by-step instructions to target crypto with Coinbase. First, let’s recap what staking is.
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What is staking?
Staking is a feature for proof of stake (POS) cryptocurrencies such as Polkadot (DOT), Cardano (ADA), Tezos (XTZ), Ethereum (ETH), Cosmos (ATOM), and Polygon (MATIC). Crypto staking helps secure and validate transactions on the blockchain. As a reward for helping to secure the network, you are rewarded with a payment in the digital asset wagered in proportion to your contribution.
Depending on the coin or token there may be periods when you do not receive any return. Some digital assets also have lockout periods where you cannot access your participation for a certain period of time, as it is used on the blockchain network. One example is Cosmos (ATOM), which has a 21-day unlock period. This means that once you cancel an amount, it takes 21 days before you can access the activities.
Typically, you delegate the cryptocurrency you want to point to a validator. When you delegate your cryptocurrency to a validator, you’re not giving up your holdings to them, but simply giving them the power to use it to do things like vote on proposals or validate transactions. The goods remain in your custody.
You can also target digital assets through an exchange. Some exchanges offer wagering rewards if you simply hold the asset on the exchange, while others require you to deposit it into their Earn program, as is the case with Coinbase Earn.
How to bet on Coinbase: step by step guide
Below, we’ll walk through the steps needed to bet encryption on the Coinbase exchange. For this example we will describe how to bet Ethereum on Coinbase. While you can target ETH on your own through an app like Ledger Live, it’s a more complex process. This is especially true when compared to Ethereum’s staking with a provider like Coinbase.
Betting Ethereum through Coinbase this way is the best way for a beginner to get started with ETH staking as less technical knowledge, less cost, and more support available are required.
Note that to point any asset with Coinbase, you must register for an account and have part of the asset you want to put into play in your Coinbase account. Let’s get into it.
Staking on Coinbase in 6 steps
Step 1: Log in to your Coinbase account. Then locate the “Earn” tab on the right side of the homepage (and every page). Click “Earn”
Step 2: Once you are on the Earn Coinbase page, you can see the resources you need to point to in the Get Started box. Click “ETH Stake”. If you don’t already have an asset you can bet, it will instead show you which assets you can buy and their annual percentage staking return (APY).
Step 3: After clicking on “ETH Stake” (or whatever asset you choose to bet), you will see the following message. Click “I understand” or, if you want to know more about the staking process, click “Learn More”.
Step 4: Enter the amount of ETH you want to bet, or click “Stake All” to bet the entire balance. For other resources the requests will be the same. When you are satisfied with the amount, click “Continue”.
Step 5: You will then be shown the prompt below. Check the amount you are wagering, the wagering reward and read the terms. When you’re ready, click “Stake Now”.
Step 6: You will then be shown the confirmation below that your stake order has been sent to Coinbase Earn. You can see how much you’re earning at any time on the Earn page.
That’s all! You are now betting on Coinbase Earn. Rewards will accrue automatically and will be shown as below on the Earn page.
Is staking with Coinbase safe?
Yes, betting with Coinbase is safe. There is no risk to the main balance. ETH staking had a risk before successfully completing the merge because if the merge wasn’t completed successfully, you would never receive betting rewards. However, with ETH’s successful transition from proof of work to proof of stake, there is now no risk of betting any asset using Coinbase.
Recently the SEC in the US cracked down on exchanges offering staking services (particularly Kraken) but didn’t touch Coinbase (which is a publicly traded company), so it remains to be seen what will happen. Regardless of the fact that the episode would remain available throughout the rest of the world.
How do Coinbase returns compare to other staking services/methods?
Coinbase’s staking rewards are comparable to other exchanges, with some platforms such as Binance and KuCoin offering riskier forms of staking with higher returns. However, compared to staking resources directly on a protocol, returns can be low.
For example, if you bet Cardano on a validator on the Cardano blockchain rather than on Coinbase, the average return is around 4% per year. Compared to the 2% offered by Coinbase, this is low. However, you’re trading a bit of a return for the convenience of Coinbase’s Earn program.