Cryptocurrency staking is becoming one of the most reliable ways for investors to generate passive income while contributing to the security and decentralization of blockchain networks. Staking offers regular rewards by locking up coins, helping networks validate transactions, and increasing liquidity. In 2024, several altcoins stand out for their staking potential, offering attractive annual yields (APY) with varying degrees of risk and flexibility. Below is a breakdown of the top altcoins for staking to earn passive income this year.
1. Cardano (ADA)
APY: 4.6% to 22.8%
Cardano remains a favorite among stakers due to its research-driven development and sustainability focus. Investors can either delegate their ADA to staking pools for around 4.6% APY or run a node (staking pool operator), which offers returns up to 22.8% annually. With no minimum staking amount, ADA provides flexibility for both small and large investors. Cardano staking can be performed using wallets like Daedalus and Yoroi, or through centralized exchanges like Binance and Kraken.
- Best For: Investors seeking long-term, stable returns without high technical requirements.
- Options: Delegation or running a staking pool node.
- Risk Level: Low to moderate due to ADA’s reputation and growing ecosystem.
2. Solana (SOL)
APY: 6-10%
Known for its high-speed blockchain infrastructure, Solana offers attractive staking rewards through both node operation and delegation. Solana staking supports the network’s scalability, making it ideal for DeFi and gaming applications. Delegating SOL to a validator yields between 6% and 10% APY, depending on the platform and staking duration.
- Best For: Investors interested in high-throughput blockchain ecosystems.
- Options: Running a node or delegating to a validator.
- Risk Level: Moderate, as Solana has faced occasional outages but continues to innovate.
3. Tezos (XTZ)
APY: 5.3% to 5.9%
Tezos offers a user-friendly staking experience through “baking” (node operation) or delegation to bakers. Running a baking node can yield close to 5.9% APR, while delegating offers slightly lower returns around 5.3%. Additionally, users retain custody of their assets when delegating, providing security and flexibility. Staking can be done using wallets like Ledger or Exodus, or through exchanges like Kraken and Coinbase.
- Best For: Users who prefer a secure, governance-driven ecosystem.
- Options: Running a baking node or delegating XTZ to a baker.
- Risk Level: Moderate due to the technical requirements of becoming a baker.
4. Polkadot (DOT)
APY: 8-14%
Polkadot is known for its interoperability and multi-chain architecture, with staking playing a critical role in securing its ecosystem. Staking rewards on Polkadot range between 8% to 14%, making it one of the more attractive options for long-term investors. However, the platform requires participants to lock their tokens for specific periods, typically 28 days or more.
- Best For: Investors looking for high yields and cross-chain opportunities.
- Options: Running a validator node or delegating to one.
- Risk Level: High, as Polkadot staking involves lengthy lock-up periods.
5. Ethereum (ETH) via Liquid Staking
APY: 3-5%
With the shift to Proof of Stake (PoS) under Ethereum 2.0, ETH staking has become more accessible. Investors can stake directly or through liquid staking platforms like Lido, which allow them to receive a derivative token (stETH) that can be used elsewhere in DeFi. ETH staking offers moderate returns of 3% to 5% annually, with the added advantage of liquidity even while tokens are staked.
- Best For: Investors seeking a balance of liquidity and security.
- Options: Liquid staking or staking through a validator node.
- Risk Level: Low to moderate, given Ethereum’s prominence in the crypto space.
6. Polygon (MATIC)
APY: 5-12%
Polygon offers staking rewards through both validator nodes and delegation, providing yields between 5% and 12%. As a leading layer-2 scaling solution for Ethereum, Polygon staking attracts users who wish to benefit from both scalability and DeFi opportunities. Polygon’s staking infrastructure is relatively straightforward, and it supports both flexible and locked staking options through exchanges.
- Best For: Users interested in scaling Ethereum while earning passive income.
- Options: Validator nodes and delegations.
- Risk Level: Moderate, as Polygon staking faces risks associated with Ethereum’s network stability.
7. Avalanche (AVAX)
APY: 9-11%
Avalanche’s sub-second transaction finality and scalable ecosystem make it a solid contender for staking in 2024. AVAX staking rewards are typically in the 9% to 11% range, with locked staking periods required. As a relatively newer blockchain, Avalanche offers opportunities for higher yields but may carry more volatility risks.
- Best For: Users looking for high-speed networks with customizable applications.
- Options: Running a node or delegation.
- Risk Level: Moderate to high due to potential market fluctuations.
Conclusion: Best Altcoins for Staking in 2024
Staking altcoins provides an excellent way to earn passive income in 2024. While Cardano, Solana, and Tezos offer stable returns with established staking systems, Polkadot and Avalanche cater to investors seeking higher rewards. Meanwhile, Ethereum and Polygon provide unique opportunities through liquid staking and layer-2 scaling solutions.
When choosing an altcoin for staking, it’s essential to consider factors like lock-up periods, staking fees, and market volatility. By aligning staking strategies with personal financial goals, investors can maximize their passive income while participating in the growth of blockchain networks.
For more detailed insights, platforms like CoinMarketCap, Techopedia, and Koinly provide further analysis on staking opportunities and platform comparisons.
