U.S-based crypto exchange Coinbase users will now be able to stake their Solana token on the platform and earn rewards from doing so.
Coinbase made this known in a June 29 blog post stating that it was expanding its staking services to include Solana.
Staking services allow token holders to assign their tokens to a validator, which benefits in increased voting weight. While doing so, token holders earn a passive income which varies per blockchain.
Through exchanges like Coinbase, which provide staking services, users can bypass the difficulty associated with staking Solana individually. Therefore, this latest introduction will allow users to stake their Solana tokens bought on Coinbase or deposited from another wallet.
In return, users will earn an estimated annual return of 3.87% APY, which accumulates every 3–4 days. Additionally, holders can earn rewards on stakes as little as $1.
Also, users who stake through Coinbase can unstake and transact with their tokens as they wish.
As included in the post, the rewards rate is based on the estimated protocol rate, which is subject to change. On every reward, Coinbase will charge a 25% commission.
The crypto exchange assured that the staking feature would be progressively rolled out to all eligible customers.
Crypto winter woes
The crypto winter has affected Coinbase and Solana, with both experiencing a wide range of issues.
Goldman Sachs, on June 27, downgraded Coinbase’s stock rating to sell due to the bearish state of the market. Even though Coinbase recently laid off 18% of its workforce, the investment bank suggested it would have to let more staff go.
As expected, the crypto exchange stocks plummeted by 5.9% to trade at $59.40 in the premarket.
The crypto exchange’s stock has declined and is currently trading at $49.75, a 2.79% drop in the last 24 hours.
Likewise, Solana has recently struggled to stay afloat despite launching a web3 mobile phone. The proof-of-stake blockchain has seen its token drop 8.79% in the last 24 hours, according to data from CoinMarketCap.
Projects hosted on the Solana blockchain have also experienced turbulence in this prolonged crypto winter.