How to Earn Cryptocurrency Staking Rewards on Coinbase: Step-by-Step Tutorial

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Coinbase is the largest cryptocurrency exchange in the United States by daily trading volume. It offers an easy-to-use staking-as-a-service program called Earn, which allows you to stake cryptocurrencies and earn rewards.

With excellent liquidity, reliability, and security, Earn is a great place to earn staking rewards if you are a beginner or HODLer.

In this guide, we will learn more about Coinbase Earn and explain its features, advantages, disadvantages, eligibility requirements, earning potential, and associated risks.

At a glance

compensation rate: Up to 10% APY*, enhanced rewards for Coinbase One subscribers.

qualifying assets: Ethereum (ETH), Cosmos (ATOM), Solana (SOL), Polkadot (DOT), Polygon (POL), Tezos (XTZ), Cardano (ADA), Coinbase Wrapped Ethereum (cbETH)

Minimum deposit and balance: Cryptocurrency worth at least $1.

Advantages:

• A safe and easy way for long-term holders to earn staking rewards
• No technical knowledge is required to participate.
• Start small
• Potential to earn up to 10% APY
• Coinbase is the only exchange listed in the United States.
• Staked assets never leave your account and are never loaned out.
• According to the company, customers have never lost cryptocurrency while staking.

disadvantage:

• Unstaking staked assets takes time (varying from a few days to a few weeks depending on the asset).
• Currently available with a limited number of tokens
• Coinbase charges a fee for rewards you stake through its service.
• Service availability varies by country and state.

What is Coinbase Savings?

Staking uses Proof-of-Stake (PoS) algorithms, such as Ethereum, Solana, and Cardano, to verify on-chain blockchain transactions. In return for helping secure the network by “staking” (or locking) their cryptocurrency, stakers are compensated with a portion of network transaction fees.

Typically, staking requires technical knowledge and a huge amount of change. For example, on the Ethereum network, an individual staker needs at least 32 ETH to run a validator.

Coinbase makes staking more accessible by batch processing assets staked by many users and handling the technical work.

Coinbase makes staking accessible to everyone through its monetization service. It operates under a Staking-as-a-Service (StaaS) model that allows you to stake funds with just a few clicks. You don’t have to worry about technical details or computer hardware, and you don’t have to spend a lot of money.

How do Coinbase savings work?

Coinbase handles all the technical aspects of pooling funds from many account holders and then securing and managing the validator nodes needed to stake and secure the network.

Since assets are pooled together, customers can stake as much or as little as they want, starting with just $1 worth of cryptocurrency. This is much cheaper than 32 ETH! Coinbase charges a small fee (see Staking Services here) for rewards received from the network in exchange for its services.

Rewards and supported cryptocurrencies

By staking, you “lock” your cryptocurrency. This means that staked assets cannot be sold or transferred until they are unstaked, which can take minutes or weeks depending on the asset.

Users can request unstaking at any time, and Coinbase will display the estimated unstaking time when staking assets.

Start earning on Coinbase

Set up your Coinbase account

The first step to start earning money on Coinbase is to create a Coinbase account.

• Please select one of the following: individual or business Depending on your account type
• Please enter the following details accurately:
  • Your name (as it appears on your ID card)
  • active email address
  • A secure password for your account

• Please take the time to read our User Agreement and Privacy Policy.
• click Create a free account when you are ready
• Coinbase will send a confirmation email to the email account you provided. Open the email and click the OK button.

• You will be asked to enter your phone number for verification.
• Enter your mobile phone number and click Send Code

• Coinbase will send a 7-digit code to your phone. Enter the code on the Coinbase page and click. submit
• You will now be asked to provide additional personal information, including:
  • Name, date of birth, gender
  • address
  • ID number
  • Purpose of using Coinbase
  • source of funds
  • Current employment status
• click Continue You can complete the registration process whenever you are ready.

Your Coinbase account is now activated. The next step is to upload a copy of your ID and a selfie for Know Your Customer (KYC) verification. This is a required step. Log in to your account and go to your profile page to complete KYC.

Enable 2FA authentication

Once ID verification has been successfully completed, we recommend enabling Two-Factor Authentication (2FA) for an additional layer of security for your Coinbase account. 2FA can help reduce the risk of unauthorized access to your accounts and funds.

When 2FA is enabled, it will be triggered when anyone:

• Trying to log in to your account using an unknown device or phone number.
• You want to send cryptocurrency from your Coinbase account.

To enable these operations, your system requires a unique verification code that only you have access to. Coinbase offers four types of 2FA authentication with varying levels of security and convenience.

• physical security key
• Google OTP
• Coinbase Security Prompt
• SMS/Text

Coinbase Savings Settings

After creating a Coinbase account, setting up 2FA, and linking your credit card/wallet/other payment method, the next step is to enable staking. While logged in, you can access the Earnings webpage by going to https://www.coinbase.com/earn/, or if using the app, you can find the Earnings tab (%) in the bottom navigation. bar. You can also stake eligible assets directly from your eligible asset wallet by following the staking instructions on the wallet screen.

Who can participate in Coinbase staking?

Cryptocurrency staking using Earn is available in most jurisdictions, but availability may change daily as the regulatory environment changes. Coinbase recommends checking your account to get accurate information about availability in your area. However, local laws regarding cryptocurrency use can vary widely. You can check your Coinbase account for the most up-to-date information regarding your eligibility. Please visit the official Coinbase support page for up-to-date information on eligibility status.

To receive staking rewards, you must own an eligible asset or token in your Coinbase account. To deposit to your Coinbase account:

• Transfer some eligible tokens from your Coinbase wallet to your Coinbase account, or
• Use your linked credit card to purchase eligible tokens directly from Coinbase on the My Assets page.

In addition to one-time purchases, you also have the option to set up and automate recurring purchases of your preferred staking tokens based on a fixed schedule and budget. (See our article on dollar cost averaging.)

Disadvantages of staking

The biggest drawback is the unstaking period, which can vary from minutes to weeks depending on the asset. Coinbase will display the estimated withdrawal time when you stake your assets. Be careful in case immediate access to your cryptocurrency is important to you.

Proof-of-stake blockchains also encourage validator quality by imposing reward penalties in case of network or validator errors. According to Coinbase, they take strict measures to reduce these risks and no customer has lost cryptocurrency due to staking with Coinbase. Coinbase is committed to complying with the rules of the networks it operates on.

Investor Implications

With a user-friendly interface, in-depth performance data, and a wide range of supported assets, Coinbase is an excellent platform for cryptocurrency newcomers and long-term holders interested in staking rewards. The Earn program allows you to start staking with as little as $1 in cryptocurrency assets without requiring advanced knowledge of blockchain networks.

One popular strategy for cryptocurrency beginners is to purchase assets in small amounts. Ideally, you would use automated recurring purchase options for long-term results.

And if you already hold existing tokens like ETH, SOL, or ADA long-term, it makes sense to leverage those assets for staking to leverage cryptocurrencies.

* Disclaimer: All cryptocurrency staking reward rates are subject to change. The APY you receive depends on the rewards you earn from the network and may change over time. Coinbase takes a commission on all rewards received, and this fee is reflected in the APY for customers. Customers can check the latest rates directly in their account. Staking auto-enrollment is only available in eligible jurisdictions and eligible networks. Staking on some networks may require active consent. Your ability to trade, transfer, sell or otherwise use Staked Assets may be limited and subject to periods of network disconnection.