The 4 Best Ethereum Staking Platforms with the Highest APY for 2024

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 4 Ethereum Staking Platforms Ranked

Here are our top four picks for the best Ethereum staking platforms, along with what makes them stand out.

  1. Coinbase A highly compliant crypto exchange, launched as a publicly traded company in the US in 2021, further its cementing legitimacy. Its staking service, “Coinbase Earn”, offers 3.25% APY on staked Ethereum and up to 10% on other popular staking assets.
  2. 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%.
  3. 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.
  4. 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. Coinbase – Leading Exchange Offering Staking On Many Assets With 3.25% ETH APY

Coinbase is a publicly traded company and one of the top crypto exchanges. It is the second largest exchange by trading volume, second only to Binance. However, Coinbase is listed over Binance, and as #1 overall, because Coinbase is a much more regulatory-compliant company,  even before Binance’s exit from the US that forced its founder and CEO to step down, and despite Coinbase’s recent struggles with the SEC.

Ethereum Staking Coinbase Staking Dashboard

When it comes to staking, Coinase Ethereum staking offers a 3.25% APY, as well as staking on a range of other top cryptos, including USDC, Solana, Polkadot, Cardano and more.

Coinbase does not impose a lock-up period, but users may have to wait until the unstaking process is complete by the protocol on which it is staked to receive their crypto.

Staking ETH on Coinbase is a relatively straightforward process, following the same process as staking other cryptos on the platform. Like Lido DAO, Coinbase offers a synthetic staked ETH token, cbETH, on which users can earn an additional yield or remove from the platform and trade on external exchanges—sometimes this token trades at a different price to that of regular ETH.

Coinbase earn staking homepage

For those looking to either set up their own staking service, as a business or developer, or for individuals who want to keep custody of their assets while staking, Coinbase has the Coinbase Cloud service.

Coinbase Cloud is an enterprise level staking solution that offers staking over 15 different networks and allows users to keep custody of their assets while not having to worry about having to deal with protocol or hardware upgrades.

Coinbase’s staking service, Coinbase Earn, is accessible in over 100 countries and is trust by thousands of  users. At the tie of writing, Coinbase is the second largest staker of Ethereum, with around 2 million ETH (15% of total staked ETH) staked through the platform.

As a final icing on the cake, the Coinbase platform offers a seamless and easy-to-use user interface that is great for beginners who are new to crypto or Ethereum staking.

Staking Rewards 3.25% (but varies depending on the total amount of ETH staked).
Lock-In Period No lock-in period
Payout Frequency Every three days

Pros pros

  • Widely regulatory compliant and regarded as one of the most secure crypto exchanges.
  • Easy-to-use staking interface.
  • Offers staking on a wide range of cryptos.
  • Provides a synthetic liquid ETH in return for staking, furthering the yield potential.
  • Available in over 100 countries

Cons cons

  • Exhaustive KYC requirements lead to a longer than normal sign-up process.

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. 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.

Best Ethereum staking platforms

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 pros

  • Offers a high APY.
  • 50% LTV on NETH.
  • The platform is backed by insurance to protect against losses.

Cons cons

  • Ethereum staking is unavailable in the US, Canada, Australia and other countries.

3. 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.

Best Ethereum staking platforms

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%.

According to DeFiLlama, Lido holds the highest market share of all liquid ETH staking platforms, with over $14 billion total value locked (TVL).

While Lido’s growth has raised centralisation concerns, its governance process largely mitigates this risk since $LIDO holders can vote on proposals to control the staked ETH.

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 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.

Cons cons

  • Its size may make it a target of regulators.

4. 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.

Best Ethereum staking platforms

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 pros

  • More decentralised than Lido DAO.
  • The rETH token is potentially more tax efficient than other liquid ETH tokens.
  • No lock-up period.

Cons cons

  • Lower APR than some other solutions.

What is Ethereum Staking?

Key points of Ethereum staking:

  • 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.

This is evident with SEC Chair Gary Gensler suggesting all PoS cryptos are securities.

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, Coinbase is the best staking platform on Ethereum. It offers quite a standard staking reward of 3.25%, a tradable liquid staking token in return for your ETH, and has a long legacy of being one of the most secure and regulatory compliant exchanges—it also keeps over 98% of user’s assets in cold storage so you can be sure your ETH is secured as much as possible.

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.

References

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Elliott Lee
Editor
Elliott Lee
Editor

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.