Are you looking to stake Ethereum? You’re not alone. Staking can be a rewarding exercise, and Ethereum is one of the best tokens to stake in 2024.
First, Ethereum is the leading proof-of-stake (PoS) network in the entire crypto space. There are lots of activities going on on the network since it is the leading smart contract network, and because it is the launching pad for hundreds of other projects.
Since ETH is the native token used to power the entire ecosystem, staking it is a great opportunity to earn some passive income.
Depending on your level of experience and your staking goals, there are several methods of staking ETH. However, in this guide, we will only discuss the best five ways. Regardless of what you want, you’ll find one of the methods suitable for you.
Running a Node
This is the traditional way to stake Ethereum and also the oldest method. You’ll own and run an Ethereum node as a validator and you need at least 32 ETH to be able to do this.
While this is the most rewarding staking method as it brings higher returns, it is also quite demanding. You’ll have to be available when called upon to validate transactions or you suffer penalties known as slashing.
The minimum number of ETH required is also a major turnoff for most people as not everyone can have that much ETH. At the same time, it requires advanced knowledge of how the Ethereum network works, so it isn’t ideal for beginners even if you do have the minimum number of ETh required.
Through a Centralized Exchange
You can also stake ETH through a centralized crypto exchange and that’s a relief for the newbies looking to enter into this space. All you have to do is own an account with a centralized exchange such as Binance, Coinbase, Kraken, and others.
Once you buy or add ETH to the account, you can stake it to earn passive rewards. This is the ideal method for beginners as it requires very little work on their part. The exchange takes custody of your ETH and manages it for you.
However, this poses serious risk to your assets and the rewards are much less than that gotten from running a node, but it’s a good place to start out in your staking journey.
Through a Staking Pool
You can also stake ETH through a staking pool. This method is quite safe because you don’t have to relinquish the control of your assets to the platform as is the case with staking on a centralized exchange.
Instead, you’ll hold your assets in a self-custody wallet and only connect it to the staking platform to start earning. You also don’t need to run any hardware, which is a big plus as you’re delegating your ETH to an existing pool.
Another great thing about staking with a pool is that unlike staking with a centralized exchange, you don’t need to commit to any lock up period. You can unstake your ETH at any time you wish to.
Through Staking as a Service
Another way to stake ETH is to offer staking as a service to protocols that allow third parties to run nodes for them. This method works just like running a node – because you’ll run one.
The only difference is that the minimum number of ETH required is much less, so it is affordable for many more people who desire to run nodes. However, all the risks that come with running a node apply here.
Buying Leveraged Staking Tokens
Finally, you can also stake ETH but indirectly by buying the leveraged staking tokens of some protocols that offer such tokens.
These protocols adopt a leveraged liquid staking strategy, and can be very profitable but are also high-risk investments. If you’re adventurous enough, you can dive into it and who knows what could come from it?