- Cardano is a secure, scalable, and sustainable blockchain platform that is powered by the ADA token.
- The ADA token can be easily staked by just about any owner of ADA tokens.
- Cardano uses Proof-of-Stake (PoS), which allows this functionality of the tokens.
Staking Cardano is one of the easiest ways through which you can earn passive income. There are other benefits too since staking reduces price volatility and helps to maintain the integrity of the Cardano blockchain.
There are many ways through which you can stake Cardano in Canada, but for most people, staking your Cardano at an exchange will be the easiest option. This is how you can get started today.
Where to stake Cardano
How to stake Cardano
If you are interested in staking Cardano (ADA) from Canada, here is a step-by-step guide on how you can do so.
Step 1: Select a staking method
The easiest way to stake Cardano is with a crypto exchange, which is the method we concentrate on in this guide.
(Alternatively, you can stake directly with a cryptocurrency wallet which supports staking Cardano, or through a DeFi or CeFi Platform.)
Step 2: Select an exchange
You can stake Cardano at a number of well-known and trusted 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.
Step 3: Send Cardano to your wallet
If you do not already own any Cardano tokens, you can purchase them on the exchange. If you already have Cardano in a wallet, you can transfer them to the exchange 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 Cardano for. The longer you stake, the higher the yield typically will be.
Withdrawing your tokens before the end of the contract will affect the yield.
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 Cardano (ADA) 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 Cardano blockchain.
- Staking is a lot more environmentally friendly compared to mining cryptocurrencies.
- Your Cardano 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.
Is it worth staking Cardano?
Staking Cardano can be beneficial, with the reward 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 Cardano’s value decreases while staked?
Given that you will not have access to your tokens while staked, you risk the value of Cardano 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 ADA was to decrease.
How much Cardano do you need to stake?
This will depend on the exchange you select. In some cases, you can even delegate a fraction of an ADA as long as you have paid the transfer fees and wallet deposit, while some exchanges will have a minimum requirement of 5 ADA tokens, for example.
Can you lose money staking Cardano?
Losing money while staking Cardano is possible due to the fact that cryptocurrencies experience volatile price action.
Do you have to stake Cardano on an exchange?
Apart from an exchange, you can stake on Daedalus and Yoroi, which are both official Cardano wallets.