Coinbase Is Offering Up to $50 in Rewards for Staking Ethereum

If you haven’t staked crypto on Coinbase yet, the exchange has a great first stake incentive available.

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Key points

• Coinbase is offering a crypto reward if you stake Ethereum for the first time.
• Eligible users can stake $500 in Ethereum for a $50 payout.
• There are risks to Ethereum staking, including being unable to access your cryptocurrency until completion of a network upgrade.

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Coinbase makes it easy to stake Ethereum (ETH) and earn daily rewards on it. As an extra incentive, the crypto exchange is currently offering up to $50 in Ethereum rewards when you stake it for the first time.

The offer is straightforward and doesn’t take long to complete. For every $100 in Ethereum you stake, you earn $10 in Ethereum. You can earn up to $50 in Ethereum this way if you stake $500 worth. Coinbase pays out these crypto rewards within two business days.

Here are the details on Coinbase’s offer and what you should know about Ethereum staking first.

Who’s eligible for Coinbase’s first stake incentive?

There are only three eligibility requirements for this offer. You must:

• Be a legal resident of one of the 50 U.S. states, excluding Hawaii and New York.
• Be a first-time staker on Coinbase. If you’ve staked any type of cryptocurrency on Coinbase before, you can’t get this offer.
• Stake at least $100 in Ethereum. It’s recommended to stake $500 so you can get the full $50 in rewards.

The offer is available to both new and existing Coinbase users. To be eligible for Ethereum staking, you need to have completed Coinbase’s identity verification and ID document verification.

How staking Ethereum works

If you’re unfamiliar with crypto staking, it’s a way of earning passive income on your crypto holdings while supporting a blockchain network. Certain cryptocurrencies use a system called proof of stake to validate transactions. People who own this type of cryptocurrency can stake it, meaning they lock up their funds as collateral and help with the transaction verification process.

That cryptocurrency’s blockchain network chooses validators based on the amount they’ve staked. After a validator confirms a block of transactions, the network pays them in cryptocurrency for their services.

There is a unique wrinkle to Ethereum staking, because its network isn’t 100% proof of stake yet. Ethereum started out with a different system, proof of work, the same one that Bitcoin (BTC) uses. It’s now going through upgrades, and part of that involves switching to a proof-of-stake system. It currently runs both systems in parallel during the upgrade process.

While you can stake Ethereum right now, the catch is you can’t unstake it until its upgrades are complete, and no one knows when that will be. That means you’ll be unable to sell, trade, or transfer your staked Ethereum and the rewards you earn for an undetermined period of time. Note that the $50 staking incentive Coinbase offers is separate, and it is available to use when you receive it.

Deciding whether to stake Ethereum is ultimately a tradeoff between earning rewards or being able to access your coins at any time. Personally, I was planning to hold Ethereum for at least a few years anyway, so staking worked with my investing strategy.

An easy way to get free Ethereum

If you’re interested in Coinbase’s offer, here’s how to get it:

• Make sure you have at least $100 of Ethereum in your Coinbase account, or $500 if you want the full $50 bonus.
• On the main menu, click “More.”
• Click “Earn interest” on the pop-up menu that appears.
• Choose Ethereum 2 and follow the prompts to stake your coins.

Coinbase is one of the top crypto exchanges, and it’s in part because of all the special offers it has available. If you haven’t tried staking on Coinbase yet but you’re open to it, this Ethereum bonus is worth checking out.