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Binance US, the US division of the Binance cryptocurrency exchange, has unveiled crypto staking services. Through this service, the exchange expects it to be more competitive than its rivals in the US, including Coinbase.
Binance US launches staking services
Binance US customers will now have access to staking services open to multiple cryptocurrencies. This move will be available for Binance Coin (BNB), Solana (SOL), Avalanche (AVAX), Cosmos (ATOM), Audius (AUDIO), Livepeer (LPT), and Cosmos (ATOM).
The company’s Twitter account noted that more cryptocurrencies would be supported in the future. Binance noted that these staking services were limited to blockchains using a proof-of-stake consensus. PoS is a consensus model that offers rewards when users are validating transactions.
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In PoS models, the more tokens users lock into the chain, the higher their chance of being selected as validators and generating rewards. However, most blockchains have set minimum requirements for those who want to be network validators. Therefore, smaller holders tend to pool their funds to earn rewards.
For instance, Ethereum is transitioning to a PoS consensus, and users must lock a minimum of 32 Ether (ETH) to be part of the staking. Cryptocurrency exchanges have become the ideal choice for investors that want to participate in staking with a lower amount than is required. Stakers earn rewards by being part of a pool.
Staking services on Binance
Binance US operates similarly to its competitors based in the country, such as Gemini and Coinbase. The exchange allows people to stake at varying rates depending on the user’s cryptocurrency.
For example, Binance promises an annualized return of 6.4% on its native token, Binance Coin (BNB). It will also give an 18% APY for staking Livepeer. Livepeer is a decentralized video streaming network.
The APY rates offered on the cryptocurrencies staked on the platform are subject to being changed. The company noted that the changes are made according to the “estimates calculated based on the average staking rewards accrued over the past 90 days.”
Most platforms have a lock-up period, within which users cannot withdraw the staked coins. However, Binance does not have this feature, and users can unlock their tokens at any time. However, the exchange notes that it will charge a commission for “facilitating all technical staking requirements,” which could mean fees for those withdrawing staked tokens.
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