Blockchain technology in general has witnessed numerous competitions among the many blockchain systems ever launched.
In the light of this competition, the Fantom blockchain was launched in 2019 after over $40 million was raised in funds for the project and it has joined several other blockchains like Solana (SOL) and Avalanche (AVAX) in the speed and scalability competition.
Fantom (FTM) is rather popular for being a cheap and speedy layer-1 blockchain and in fact, has been labelled an “Ethereum killer”.
Fantom’s blockchain is a highly scalable and EVM- compatible smart contract platform. By being EVM-compatible, the platform allows users to run Ethereum-based decentralized applications (DApps) on the platform.
Fantom uses the proof-of-stake mechanism, Lachesis, which is responsible for the low transaction fees and high speed.
The Fantom blockchain uses its native token, FTM which is speculated to explode soon.
Do you want to jump on the prospects of this blockchain and accumulate more FTM to your portfolio? Well, this article will teach you how to stake Fantom and earn passive income.
Understanding Fantom Staking?
Staking a crypto token means locking up the token with an exchange for a certain amount of time to earn interest in the form of more tokens.
In the same way, Fantom staking allows investors to lock up a certain amount of their tokens for a certain period while earning passive income from them (FTM rewards).
Validators give security to this process by validating transactions with the tokens they staked which further incentivizes them economically and also motivates them to play along with the protocol’s rules.
Staking tokens allows owners to keep their tokens in their wallets but they have to be locked up for a certain period. However, depending on the type of staking, one can access their funds anytime when operating a flexible staking system but a locked staking system will not give access to the staked tokens until the agreed date.
How To Stake FTM
There are a few strategies one can employ while staking FTM but it is important to know that running a validator required a minimum stake amount of 500,000 FTM if Sybil attacks must be prevented from its consensus mechanism.
Sybil attacks operate by using multiple fake identities to access and take unfair advantage of the network.
So, since the amount required of a validator is quite high, delegating FTM to a validator becomes effortless.
Below are some strategies you can use to stake FTM ;
1. Fluid Staking:
This strategy allows investors to stake their FTM tokens for a period between 2 weeks to one year. Investors are rewarded based on the period length their FTMs are staked. The higher the time, the higher the reward and vice versa.
2. Liquid Staking:
This required investors to mint FTM for a better return on investment (ROI). Also, being part of liquidity mining, staking farmed tokens, and farm LP rewards are all tenets of liquidity staking.
3. Custodial Staking:
Custodial staking requires investors to take FTM on centralized exchanges like Binance or Coinbase and get a staking reward of 1%
How To Stake FTM On Fantom
If you want to stake FTM on the Fantom platform, these simple steps will guide you through it.
- First and foremost, you must have 1 more FTM to stake.
- Visit the Fantom platform, on the staking page, click on “Stake Your FTM“
- Using a hardware wallet like Metamask on your computer or mobile device, you can log in.
- Pay in your FTM to your Fantom Opera wallet address by sending them directly from an exchange or another wallet.
- Click on “Staking“.
- Select a validator and amount.
- Select the period in which you’d want to lock up your FTM and confirm.
Optimal Fantom wallets have very limited options but the Fantom Opera network which is a second layer blockchain are more receptive to Ethereum wallets like Metamask.
Is It Safe To Stake FTM?
Since the validator node cannot have access to your staked FTM, then your staked FTM is completely safe.
However, keep your private keys and seed phrase safe from the wrong hands.
It is very important to choose reliable Fantom validators who have built large reputable communities, websites and social media pages because you may run a risk of losing a part of your stake if the validator is not genuine, just like in every other proof-of-stake blockchain.
Where Can I Stake FTM?
Fantom staking is not limited to just the Fantom blockchain network, investors can also stake Fantom across other centralized and decentralized platforms.
Here are some of the platforms one can conveniently stake Fantom, so you may choose which is most suitable for you.
Stake Fantom on Binance:
Binance is the world’s largest crypto exchange where numerous crypto tokens are traded daily. Staking FTM on Binance requires an investor to deposit a suitable amount on Binance, and then choose the best product from the enlisted products on “Binance Earn“.
The lock-up period is normally about 30,60 or 120 days but choosing a longer staking period can guarantee a higher return.
Stake Fantom on Ledger:
Ledger is a hardware crypto wallet which can also be utilized to stake FTM. This involves the interaction of a smart contract just like every other transaction.
By signing into the Fantom FTM Ledger Nano S application, a user can stake from the Fantom wallet.
This is done by clicking on the “Stake” menu on the account.
Stake Fantom on Coinbase:
Coinbase is one of the major centralized exchanges in the world where crypto trading and staking are carried out. Fantom announced a partnership with Coinbase in September 2021 as support for the Fantom network.
This means that the Fantom network and Fantom DApps were made accessible to Coinbase wallet users who can use and engage them conveniently.
By connecting their Coinbase Wallet account to their Fantom wallet, users can partake in all the Fantom activities like staking FTM.
How Much Money Can You Make From Fantom Staking?
You can earn quite a good sum of money from fantom staking depending on the lock-up period and the amount you choose.
The APY for 14 days (minimum) and the minimum amount is about 5.01% but the APY for the maximum lock-up period of 365 days is 15.31%
You need not worry about calculating your rewards because the FTM staking rewards automated calculator will estimate the value of your potential earnings.
Most importantly, the number of your earned FTM will not necessarily make you rich but can grow your token holdings. This is because the value of FTM is affected by the general crypto bear market.
Most crypto tokens have lost over 70% of their value since the crypto winter started and FTM is not excluded.
Conclusion
Generally, staking crypto tokens is a profitable venture especially when the amount and lock-up period are high. Given that Fantom is very popular and promising blockchain technology, staking FTM is a good way to earn more passive income.
However, while staking FTM, ensure to choose a reputable validator, to avoid losing some part of your investment to an unreliable validator.
Disclaimer: This article is completely the opinion of the author and should not be considered financial or investment advice.
You should conduct your research before making any investment decision.
