- Polygon (MATIC) is a popular staking token in the Defi space.
- MATIC tokens can be purchased on any Polygon-supported crypto exchange or wallet.
- People who stake their MATIC can make returns and offset movements in prices.
Staking MATIC for a passive income is one of the most popular ways the token is put to use.
By staking MATIC people can reduce the volatility of price movements and it helps to maintain the integrity of the MATIC network.
This is a step-by-step guide for where and how Australians can stake Polygon.
Where to stake Polygon (MATIC)
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How to stake MATIC
If you are interested in staking Polygon (MATIC) from Australia, here is a step-by-step guide on how you can do so.
Step 1: Select a staking method
The easiest way to stake MATIC is with a crypto exchange, or with a Defi project.
Step 2: Select an exchange
You can stake Polygon (MATIC) at a number of well-known crypto exchanges. When you are comparing exchanges where you can stake, there are several things to look for.
Make sure that you are satisfied with the security measures in place at the exchange and that there have been no recent security compromises.
Since yield and fees vary between exchanges, compare how much you could earn and what fees you would have to pay. Make sure the crypto exchange is trustworthy.
Step 3: Send Polygon MATIC to your wallet
If you do not already own any Polygon MATIC tokens, you can buy them on the exchange.
If you already have MATIC in a wallet, you can transfer them to the exchange or a defi project where they can then be staked.
Step 4: Set up the contract
The exchange operates as the staking pool operator. Any rewards earned in return for staking will be acquired and administered by the exchange.
When configuring the contract, you will have to specify how long you want to stake your MATIC. Typically, the longer you stake, the higher the yield typically will be.
Withdrawing your tokens before the end of the contract will affect the yield (APY).
Make sure you clearly understand all the terms and conditions before staking.
Pros and cons
- Staking is an easy way to earn interest on your Polygon (MATIC) holdings, with yields increasing the longer you stake for.
- You can stake without any mining equipment, such as you would for Proof-of-Work (PoW) cryptocurrencies like Bitcoin.
- Staking benefits the community by helping to maintain the integrity and efficiency of the Polygon network.
- Staking is a lot more environmentally friendly compared to mining cryptocurrencies.
- Your Polygon coins will be inaccessible while staked, leaving you exposed to loss from market volatility.
- There are fees to stake at an exchange, which will offset profits.
- Staking Polygon doesn't shield you from loss.
Is it worth staking Polygon MATIC?
Staking MATIC can be rewarding, with the rewards increasing the longer you stake for. However, staking a small number of tokens for a short period of time may not yield a meaningful amount.
What happens if the price of MATIC decreases while staked?
Typically, you won't have access to your MATIC tokens while they are staked or locked up on an exchange. That means you risk the value of MATIC falling and being unable to sell out of your position. If this scenario played out, the amount you would lose would depend on how far the value of MATIC was to decrease.
How much MATIC do you need to stake?
Typically, there are no upper or lower limits on how much MATIC you can stake. Only a small amount of MATIC will be needed to stake of a couple of MATIC tokens.
Can you lose money staking MATIC?
Yes, you can lose money while staking MATIC since the price action can be volatile. Also, you run the risk of a crypto exchange collapsing or a defi project melting down while your MATIC is locked up.
Do you have to stake MATIC on an exchange?
No, you could also look for a Defi project or a liquidity pool to stake your MATIC.