## Bitvavo Introduces New Cryptocurrencies to its Staking Service
Bitvavo, the biggest cryptocurrency exchange in the Netherlands, recently announced that it will be adding some new cryptocurrencies to its staking service starting from April 18. Along with the new additions, there will be a few changes implemented in the service as well. Let’s look into this news in detail.
### The New Cryptocurrencies Added to Bitvavo’s Staking Service
Bitvavo is adding the following cryptocurrencies to its staking service: Terra (LUNA), NEAR Protocol (NEAR), Komodo (KMD), LTO Network (LTO), The Graph (GRT), and Kusama (KSM). These new additions have varying interest rates, ranging from 2% to as high as 7%.
### Changes to Bitvavo’s Staking Service
Apart from adding new currencies to its staking service, Bitvavo is also discontinuing the staking service for some cryptocurrencies, including Dai (DAI), Chainlink (LINK), Litecoin (LTC), and Tether (USDT). Furthermore, the staking rewards have been updated to align with the protocol rewards and the current market.
### Understanding On-Chain vs. Off-Chain Staking
There are two types of staking: on-chain and off-chain. On-chain staking is exclusively for cryptocurrencies that use Proof-of-Stake as their consensus mechanism, such as Ethereum (ETH) or Cardano (ADA).
By staking your crypto on-chain, you contribute to the security and the functioning of the relevant blockchain. There are various ways to stake on-chain, such as using a centralized crypto exchange like Bitvavo. You can also become a validator on the network or join a staking pool. However, for beginners, staking on a centralized exchange is often the most accessible option.
In contrast, off-chain staking works differently from its counterpart in theory. However, the outcome remains the same: you receive a reward in exchange for holding crypto. Off-chain staking can be done with both Proof-of-Stake and Proof-of-Work cryptocurrencies and is unrelated to the consensus mechanism. With this type of staking, the user agrees to lend the supported cryptocurrencies to other external parties to earn money.
In Bitvavo’s case, Bitvavo Custody BV lends the assets to external lending partners.
Bitvavo is making a significant update to its staking service by adding new cryptocurrencies and discontinuing some. Understanding the differences between on-chain and off-chain staking is crucial for investors to make informed decisions about their investments. With the right strategy, staking can be a profitable option for investors looking to earn passive income from their crypto holdings.