Bitcoin Forum

Bitcoin staking can be another holding/investment strategy for idle coins or upcoming traders. It can be done in two ways. Flexible and fixed. The flexible staking is one that can be unstaked at any time. While the fixed is staked for a shorter period but must be redeemed for it to be unstaked. This means that in flexible as the word implies, it is not rigid and you can terminate the staking any time you want but fixed is a rigid one that cannot be terminated and must reach the timeline of the staking. The rewards in staking is earnings. For freshers and even professional traders, staking appears to be a very viable investment opportunity for profits. The fixed staking has higher APR while and cannot be unstaked until the maturity/redemption time. While the APR for flexible is lower and can be terminated at any time.
Staking and earning is good for idle funds/coins and can really help upcoming traders that are always busy with other works or activities.

What do you think about this?

Not your key not your coins. What you are referring to is staking or saving and earning on centralized exchanges. Bitcoin is using proof of work (PoW) and not proof of stake (PoS). So you can not stake bitcoin except a centralized platform is offering you something like that.

But some people can go for altcoins staking, like wBTC which is not bitcoin but an altcoin that is backed by bitcoin price.

I don't like using the term "Staking" for bitcoin. The term "stake" should be used for proof of stake cryptocurrencies.
Bitcoin is a proof of work cryptocurrency and there is no such thing as staking in bitcoin.


When you stake your bitcoin, you actually give a third party full control over your bitcoin and get some interest for that. That's not staking at all and I would never do that.
Not your keys, not your coins.

When you stake your bitcoin, it's no longer your own because you have given it to a third party, your bitcoin will be vulnerable to hack or an exit scam. It is not ideal to stake bitcoin when if you leave it in your noncustodial wallet, it will generate profits on its own whenever bitcoin price pumps.

Bitcoin is provides decentralization and security through PoW why using it in the opposite way. Just as the two posters above said not your keys not your funds.

Usually, as far as I know, the staking that other communities do is on the cex platform, though you only need to do it on trusted exchange platforms, but no matter how trusted and reputable it is, it still remains "not your coins not your key"

so you should know what the consequences of doing it on a centralized platform are, you should be prepared for unexpected things, it really depends on the trust you place on that matter.

I'm not a fan of staking personally. I would rather keep buying and selling to get some profits every now and then than staking my assets even if my initial plan was to keep holding. The reason is pretty simple, I believe that you don't get to sell your assets immediately if you have to, when you have them in staking, because some staking contracts in centralized exchanges or staking protocols don't let you withdraw your funds immediately based on an agreement you have agreed upon when staking your assets.

That's why, in case you need to sell your assets, or a portion of it, either because the price has gone up or maybe you are up against an emergency, you won't be able to do it. So it's better to have your assets free at all times so that you can do whatever you want with it instead of having to request a redeem and then wait for your own assets to get unlocked or released. Overall for me, trading is better than staking, and I'd prefer trading over staking any day.

Don't stake on centralized platforms.

Even in DeFi there are a few decent platforms like Beefy but options have become very limited outside of that. Everything else has gotten hacked or rugged.

Many tokens went to zero because of flaws in tokenomics etc. It's all a very weird landscape. Staking on centralized platforms has proved risky because of the bankruptcy risk like FTX and Celsius, similarly to MtGox. You could be getting peanuts back based on your initial deposit with the rest of the crypto gone forever.

Crypto exchanges aren't systemically protected like bank deposits so you'll have a very hard time getting your money back especially in many of the not so well known exchanges. Imagine a crypto exchange going bankrupt in Korea for instance. The restitution would take many years to cooperate with American authorities and be completed for international participants. It'd be a nightmare just like it was for MtGox creditors.

@Oohio, believe what you read on the first comment.
It is recommended to hold your Bitcoin in your wallet and not on the exchange wallet. Don't stake your Bitcoin on centralized exchange and you will still make your profit during bull season. What gave you the impression that staking is a good investment? When you invest into Bitcoin and hold in a non centralized wallet, it's already a great investment but when you stake on centralized platforms, that's when you are making a mistake because the process does not give you total control on your asset.

When it comes to Bitcoin, the safest move is to hold it in your own wallet. If you have the keys, then it’s truly your Bitcoin.

The problem with staking is that you’re exposing yourself to extra risk for very minimal returns, and personally, I don’t think it’s worth it.

Maybe I’d consider staking with altcoins, but only to a limited extent, because staking doesn’t guarantee profit. At the end of the day, we still depend on the value of the asset we’re staking. But I’ll say it again - for Bitcoin, the best strategy is to just HODL.

Despite the fact that many consider stacking unacceptable, since you have to trust your coins to a third party and lose control over them, I still use ETH for staking, which I expect to sell when the price reaches 5-6 thousand dollars. The main thing to do is to choose an exchange that you can trust with your savings. For me, Binance is such an exchange at the moment.

Anything could happen to Binance too, just like things went south for FTX which at one point was the second-largest exchange in terms of trading volume. You don't want to be in a situation where the exchange declares some sort of bankruptcy. I know people who lost money with platforms like Celsius network that they trust so much.

In terms of less risk. I think just buying ETH and keeping in a noncustodial wallet beats this, or stake in a noncustodial wallet if you can.

If it's on altcoins, it would be a good thing to try staking on their own platforms since you have your own keys and you have the control on it.
 
Now I bolded the word "Bitcoin" because the only way for you to stake or earn from your Bitcoins are when you store it on those exchanges out there that gives you around 1-2% annually just to store your assets there. Now it isn't recommendable to store huge amounts of assets on CEXes, but if you don't care about the possible hacks that could happen, and a possibility of you losing your assets or them freezing your account then put it on there.

Apparently, there's this token which primarily focuses on Bitcoin Staking which has a name of "Babylon", and I'm not that much familiar with it, and I don't know if it gained traction at all, but maybe you can try putting it there as well.

There is no native staking for Bitcoin.

Bitcoin is a proof of work blockchain. Only proof of stake blockchains comes with staking mechanism that allows token on the network to be staked. Bitcoin doesn't have such feature/flexibility. While the idea of staking is interesting especially for an asset like bitcoin that is a global store od value, I don't think it's something Bitcoin needs.

Maybe that changes in the future but I have strong doubt about that.

Bitcoin is not a PoS and so you cannot stake it as if it's part of its system or blockchain. The staking feature that's being told by these platforms and exchanges are wanting to deposit our BTCs on them and they will earn through lending it and they'll give a portion of that interest to us as our profits. I wouldn't 'stake' my Bitcoin to any of them, as you've said if it's another strategy that you trust, I'd rather hold it on my wallet and wait for the price to increase. Because that's safer and I hold my BTCs and can sell anytime I want to and even if you'd say that it's on a flexible term, you'll never know what might happen to the platform where you have deposited or staked it.

I don't like staking very much, be it flexible staking or fixed staking. I have some Bitcoin and one Ethereum. I planned to stake that day that I would stake my one Ethereum but I went to my exchange platform and saw that the Ethereum staking APR was very low where the daily reward is 0.000038 ETH. Multiplying it by the current price of Ethereum, it comes to around 0.09 cents per day and if you stake it for a month, it is $2.96+. That's why I didn't stake and I don't like staking very much but I plan to keep my Ethereum for a long time without staking it. Also, I don't want to trade my Ethereum because trading information is risky and I can lose my Ethereum at any time.

For me if I can trade on an exchange trusting them with my coins, then I can stake my coins with a third party staking platform, since my aim is to take the risk and earn the profits, so I will just give up my coin into the hands of another and just watch the whole thing as it goes, I know for sure that some staking platform could be scams but then among such we still have some prominent well established staking projects within the crypto community to choose from.

About staking - some people will not risk their assets for the very small APR/APY percentage.
But there are really huge platforms that have already been in the market for a long time, multiple bear/bull seasons, but there's no real incident like having security issues that lead to loss of customers' funds.

I personally stake in some DeFi platforms - altcoins only. For my Bitcoin - I don't.

You did not do enough research on Bitcoin that is Proof of Work, not Proof of Stake.

So initially by technical design, bitcoin is not for staking. You can only get bitcoin from Proof of Work mining and Bitcoin block rewards as well as Bitcoin transaction fees. Otherwise, you must do things beyond Bitcoin blockchain for staking rewards but it is risky.

You need to convert your bitcoin to Bitcoin Wrapped tokens that are not bitcoins. Those tokens are altcoins and peg to Bitcoin price, though those tokens can be depegged. Staking pools can be scam and you will lose your bitcoin in many ways by staking.

All things will have pros and cons. If you can accept the cons, you can stake the coin but you should find a reliable and trusty platforms. But as @Charles-Tim said, not your keys, not your coins, you need to be ready with all risks that can happen including if the platform close their business.

If you are afraid your Bitcoin may lose anytime, you don't have to stake but just store Bitcoin in your wallet. That will be more secure because you control the Bitcoin by yourself. But for other coins, you need to make sure the platforms is safe before you decide.

This one, and let's say if you really do trust the platform and you really wanted to stake then I can say that staking is one of the best way you can do instead of idling your crypto (hodling) as it the quantity of your holding will increase along with the price of that coin (let's assume that it's bullish season) the only cons I can see here is if the platform where you stake it runs away with it or lock your account.

In Ledger I think they are offering a staking but not for Bitcoin, I think it's pretty safe to stake there, I haven't tried it though.

The only staking I would ever recommend is direct from your wallet into a liquidity pool, but beware, DEX are not as decentralized as you think. Among all the networks I would only distrust Ethereum the most (ERC20).

You have so many now and for a while I also thought BSC was good (now called only Binance Chain) but as long as the network is not decentralized, and not as secure (as BTC PoW) I would never ever leave my funds there.

Staking on a platform though? Its like gambling.

^ You never know where your funds will be in the end of it, but usually, the profit from staking is not that big to begin with, especially if you don't start with a big amount and sums to throw at it.

It can only do so much as to help the main processes going.

That’s where you find your answer you don’t trust anything on this space except yourself. There will be absolutely nothing bad if there is bitcoin staking because ideally almost all bitcoin holders are long term holders and with that if you actually stake you will be getting reward for holding and also been profitable for long term holding, so no one is actually against staking but there is no platform where you can hold and still stake your tokens again because bitcoin isn’t a POS protocol.

Just for example the same ledger doesn’t supports bitcoin holding because there is no platform for it, the rest you are handing over your asset to the platform, there multiple of them currently but in my perspective there are just borrowing your assets not staking anything. For example centralized exchanges sometimes do not even leave the bitcoin you think you staked on the platform, they simply move it to cold storage where it is not also totally secured from hacks (bybit hack was an eye opener)

There are a lot of opportunities now to make a profit by participating in an early stage of a project and getting an eydrop in new project tokens for staking. And the profit received from such airdrops far exceeds the APR, which is offered on various DeFi.

Long-term stacking is very good option for hodlers, of course we all agree with that but there is a reason why many people don't do Bitcoin stacking. Bitcoin is a Proof Of Work, not Proof Of Stake. The only option to stake Bitcoin is to deposit it on exchanges, on websites like nexo or on crypto casinos. Lots of Bitcoin enthusiasts feel uncomfortable depositing Bitcoin on these platforms because when you don't have control over your keys, you do not control your coins. In other words, deposited coins do not belong to you, so lots of crypto and Bitcoin enthusiasts prefer to not stack Bitcoin and keep it locked in their own wallets.

Is the risk high in them though? I would say that most likely - yeah, the possibilities for not a good end would be there..

The risk depends on the project. If they don't have a solid connection and they also don't have a solid use case, add in that there are other negative feedbacks about them, then yeah, the risk is high. He talks about airdrop there more, than just staking but if only about staking, it can still be done on an old project.

Therefore we can reduce our risk here easily by picking up a project that has a good record over the years. Staking is just another way to earn but the real deal here is that we can sell the token that we used on staking. That allows us to earn a better income. Meanwhile, if you still want airdrops but are afraid to take a risk, good news because they are still available for free. So it is only okay even if you end up in a bad one.

Staking is one of the most awkward thing I have seen in cryptocurrency. First is exposes users 100% to the risk of losing their entire money because staking are done mostly in CEX where users do not control the private keys of the wallet holding their money. Second, staking can be a waste of time especially when you stake some coins or token because before the staking completes, the token have diminished in price which will lead to loss. Instead of staking, it is better to invest and hold reliable asset like Bitcoin.

There are always risks, even if you keep the cryptocurrency on a hardware wallet. But I know from my own experience that the airdrops I received brought enough profit, which allows me to invest in various projects for diversification.

Staking sounds great until you realize it's in 3rd party custody.
Bitcoin maxi will get rid the idea for that simple reason, the APR are also low most of the time because there are so many BTC holders in CEX who just staked their BTC while they're at it.

Tell me again about the prospect of staking only if there's a way to stake without entrusting my BTC to stranger.

If it requires you to hold funds on a centralized exchange then there is always a lot of risk involved. Recently, there has also been new blockchains like Babylon that are secured by Bitcoin that is staked in a self-custodial manner. This seems like a better option if you want to earn on your idle Bitcoin, but your rewards will be in some new token that isn’t widely supported on exchanges and you can’t stake from most hardware wallets.

I would say that just holding BTC in your own wallet is probably the right choice for most people. Trying to earn yield on BTC just has too much risk or is not user friendly enough to do it in a secure way.

Awareness of holding their assets in their own wallets is now increasing. People who hold Bitcoin now know the risks of staking on certain platforms, where the assets they stake are not under their control. The risk of losing if you stake on a new and unreputable platform is very high. Therefore, more people will not take the risk of staking their assets. Just hold it, or you can trade it to make a profit. Manage your assets well.

Staking for Bitcoin? Ridiculous. Most probably you are talking about staking that is offered by a centralised exchange or some staking platform. Really, could you trust them with your Bitcoin? At least I am not going to trust them and can't take such a risk for a penny. Bitcoin doesn't have any on-chain staking system, so you have to choose an exchange or staking platform. Where we can't trust exchange with our funds, then how could we trust locking our funds for a period of time?

You may stake altcoins that allow you to stake on-chain. You can do it if you are too lazy like me and don't want to take any risk by trading. If you intend to hold longer, then you may choose on-chain staking, where you don't need to trust any third party. I am not sure which altcoins offer that service exactly; you have to look deeper.

Reading your post I assume that you are talking about staking on exchanges because bitcoin by protocol doesn't provide staking facility.
If you are allowing 3rd parties to stake your bitcoins then you are going against the bitcoin protocol itself.
If you don't hold the private key to your coins then you don't hold any bitcoins.
That said, your idea of staking bitcoin is not something any true bitcoin supporter would encourage.

Well I've not been able to try the staking to earn strategies but I was convinced sometime ago to give a try that it's  profitable and mostly help beginners traders who tend to have something while they are at what they do, so with that I believe it's a good investment strategy one can try on and be profitable in the long run. As you rightly said it can be done in a shorter or longer period depending on what you want.

Stacking is definitely a very good investment strategy, especially if you are a hodler because if you hodl, it means that you keep your coins in the wallet and why should you limit yourself from earning additional profit when you can earn extra money from this process? You hodl anyways, so just turn on the earning option and hodl that way.
If you want stacking, the safest way is to solo-stake Ethereum with your own validator keys and hardware wallet. I say this because when you deposit your coins on any website or platform that offers you stacking, then you no longer actually own your coins because remember, not your keys = not your coins.

Staking on-chain still require 3rd party trust. The DEX still keeping ownership of the smart contract and can halt LP withdrawal as well as swapping activity.
With staking, it's even more centralized since the money is controlled by the contract owner directly.

Remember how cetus protocol got hacked and momentum finance in SUI can freeze the contract activity?.
Staking will hardly be third party custody free.

Staking is also one of the ways to make profit in the crypto market. Instead of just keeping your crypto in your wallet and doing nothing, you can participate in staking to increase your coins or get rewards. But everything has its price and staking is no exception. When you participate in staking, it means that you no longer have full control over your crypto assets, whether to stake on-chain or use a centralized platform.

Personally, I do not recommend this as the reward is too small compared to the risk we face. Remember that making money is never easy, everything has its price and there is no such thing as passive income in this risky market.

Staking and hold can be profitable in both ways. However, there are many differences between the staking and holding. Select the Trusted platform to stake otherwise the Fund scam may be the victim. I usually stake in the new Binance platform new events. It is quite profitable and complete with security. It is possible to turn off the stake when you are happy once you start the stake and remove the fund. However, there is quite challenging to be good here. That is why those who can start with more doller are more profitable. I will always prefer Bitcoin for holder. Although there are many good coins in the market. If you are good watching then you can invest through all other coin analysis .

Well we can make some profit if we do stake our coins. But then we do not have the control over the keys to our coins.
For me it is not worth it to stake coins any more. I did used to do it and I made a little bit of profit. But for me I do want to have control of my coins at all time.

No platform is trustworthy or completely secure, not even Binance or Coinbase. They are all centralized exchanges, not your keys, not your bitcoins. There have been many hard lessons about storing bitcoin on centralized platforms like FTX, Mt.gox or even lending platforms like Celsius Network, BlockFi...all of which were considered completely safe until they collapsed, declared bankruptcy and took billions of dollars from users.

Honestly, if forced to choose to stake my BTC on these centralized exchanges, I would rather deposit money in a bank because they are much more trustworthy than centralized exchanges.