Is Staking Ethereum Worth It in 2024?

Photo by Nenad Novaković on Unsplash

It’s been about 2 years since I started my crypto journey as a student. I’ve weathered bear cycles, FTX, the Luna collapse — honestly, I’ve lost count. The recent bull run where $BTC hit an ATH of $73,000 in March 2024 was a thrill, but I’m not planning on going full on degen anytime soon, so you won’t see me writing about a hype coin. But, I will be looking at slightly less risky options.

So, while I’m looking for places to stake $ETH, I decided to put together this guide from my research. Hope someone finds it helpful!

What is Staking?

Staking is when you lock crypto assets for a set period of time to help support the operation of a blockchain. In return for staking your crypto, you earn more crypto.

1. Stakers lock up their $ETH for a period of time to earn rewards.
2. Staking contributes to the security and efficiency of the Ethereum network.
3. They earn passive income on ETH holdings.

Risks of staking

• Slashing: Validators can lose a portion of their staked ETH due to downtime or malicious behavior.
• Liquidity: Staked ETH may be locked up for a period, limiting access to your funds.
• Market Volatility: The value of ETH can fluctuate, affecting the overall value of your staked assets.
• Custodial Risks: Using third-party platforms involves trusting them with your assets.

Staking methods:

Solo Staking

• Requirements: Minimum of 32 ETH, technical knowledge to run a validator node.
• Pros: Highest potential rewards, full control over your staking.
• Cons: Requires significant investment and technical expertise.

How:

• Install Validator Software: Follow guides provided by platforms like StakeWise to set up your validator node.
• Deposit 32 ETH: Transfer the required amount to the staking contract.
• Maintain Uptime: Ensure your node is running 24/7 to avoid penalties.

Staking Pools

• Requirements: Smaller amounts of ETH (no minimum).
• Pros: Lower barrier to entry, no need to run a validator node.
• Cons: Lower rewards compared to solo staking, potential fees.

How:

• Choose a Pool: Select a reputable staking pool that meets your criteria.
• Deposit ETH: Transfer your ETH to the pool’s staking contract.
• Receive Staking Tokens: Some pools issue tokens representing your staked ETH, which can be used in DeFi applications.

Staking Platforms

• Pros: User-friendly, often offer additional features like liquidity.
• Cons: May involve fees and custodial risks.

How:

• Create an Account: Sign up on the chosen platform.
• Deposit ETH: Transfer your ETH to the platform.
• Start Staking: Follow the platform’s instructions to begin staking.

Staking platforms and pools

Here are some popular Ethereum staking platforms along with their approximate APY rates and links:

1. Lido, APY 3.8%
2. Coinbase, APY: 3.7%
3. Kraken, APY: 4–7%
4. Binance, APY: 3–5%
5. Rocket Pool, APY: 3.5–4.5%
6. StakeWise, APY: 3.8–4.2%
7. Ankr, APY: 3.5–4%
8. Staked.us,APY: 4–5%
9. Blox Staking, APY: 4–6%
10. Stakefish,APY: 4–5%

Where I’m staking, NFA, DYOR

I’m choosing to stake with Lido mainly because you can stake through ledger , it’s pretty user friendly and their reputation is ok lol.

Let me know if anyone wants a guide, happy to dive into that!

Is Staking Ethereum in 2024 Worth the Effort? Our Final Verdict

Whether staking Ethereum is worth it in 2024 depends on your individual circumstances:

Personally, I think it is worth it even at lower returns because I have holdings and would rather see some returns than none at all. I am also not as involved as before, so I am prioritising speed and ease.

This is dependent on you and your goals, but if you’re reading this, you probably have a relatively high risk tolerance so do what you think is comfortable.

• If you’re a long-term ETH holder and comfortable with the risks, staking can provide additional returns on your investment.
• Smaller investors can still participate through pooled staking or centralized exchanges, albeit with lower returns.
• Consider your risk tolerance, technical expertise, and investment goals when deciding.

Overall, while staking Ethereum can be profitable, it’s important to thoroughly research the options, understand the risks, and consider your personal financial situation before committing to staking