5 altcoins to stake

The market continues downward and remains completely unpredictable in the short term. Most of us have used up all our ‘dry powder’ to buy more on the dips and are stuck HODLing now. So now what do we do?

One great investment opportunity we can do while we wait is to stake some coins we are holding and earn some passive income. Therefore, in this article, we’ve picked The Top 5 Altcoins for Staking that there’s a good chance might be in your portfolio already.

1. AXS

Many of you who got in early on Axie specifically and the P2E trend generally made some serious money on this coin. It’s up, 2600% in the last year. That said, it’s down 26.8% just in the last 2 weeks. Now, if you rode that trend up, a drop of 26% is no reason to sell. So, you might as well stake instead.

What is AXS?

AXS is not the game token you use to breed or earn money while playing Axie Infinity. That’s SLP. So if you want coins to help you in the game, then get SLP. But if you want to make governance decisions and help influence how the game moves forward, then get AXS.

And AXS is valuable. Coingecko’s listing shows it as the 37th most valuable project in all crypto. Moreover, a token can’t be a good candidate for staking if it’s a token you don’t want to hold. One of the reasons crypto has a P2E game sector now is because of Axie Infinity.

Axie Infinity is so popular that its founders had to create the Ronin blockchain to help it scale up.

Why Stake Axie Instead of Others Tokens with Higher APY?

Aside from being the P2E leader, Axie has some other features we like including:

  • Stake directly from your Ronin wallet and maintain control of your coins
  • Stake and earn up to 76% APR.
  • A little more than ⅓ of all Axie coins are currently staked meaning the staking mechanism is working and should continue to in the short term.

Risks

The biggest risks are:

  1. You need to interact with a new chain, which you may not want to. That said, Ronin is an Ethereum side chain and has mobile and browser wallet options.
  2. Axie falls from its top leadership spot in P2E gaming, meaning that governance and staking the governance token are less important.

2. UNI

Our 2nd coin today is one of 2 exchange tokens: UNI for Uniswap, which is the 9th largest DeFi app by TVL at $7.5 billion. It’s a completely decentralized liquidity protocol. Almost 7 billion of that TVL is locked in Ethereum, although they are active on Layer 2’s like Polygon and Arbitrum.

UNI is the governance coin for the exchange. You need it if you want to vote on proposals. Some pools pay in UNI. Therefore, if  you are into DeFi, you probably use Uniswap and either already have some UNI or do not care if you end up with some.

Why Stake UNI Instead of Something With a Higher APY?

Because Uniswap has no order book, you really are not conventionally staking it like you are with the other 4 tokens on today’s list. Really you are putting into one of UNI’s pools like UNI-ETH or UNI-USDC. But you can earn 4.27% by lending it out.

We see this is a good strategic pick if you are a DeFi investor. If you aren’t then you might prefer other staking options. Their largest pool is the UNI-ETH pool and if you have both already then it makes sense to earn a little income off of it.

Risks

Well, as we said, there are other low risk options, especially if DeFi or DeFi on ETH with its expensive fees is not your thing. And to stake UNI you will have to pay ETH gas. Depending on the gas rates, it may not be worth it.

3. CAKE

CAKE is the 2nd of our 2 exchange tokens in this video. It’s the exchange and governance token for BSC’s largest DEX, PancakeSwap. It has over $4 billion in TVL right now.

As the governance token of the largest BSC protocol, CAKE is an important token. It’s not just for governance. It’s also popular in many staking, liquidity pools and yield farming investment opportunities.

We like it because it’s useful for many LP and farming opportunities. It’s also a high value token in its own right. It’s a top 75 coin with a market value over $1.7 billion dollars.

Why Stake CAKE Instead of Others at Higher APY?

First thing is if you are into DeFi on chains other than Ethereum, you probably have this token already, so it’s one less thing to buy. Second, this is one of the easiest to stake. Just look at PancakeSwap. On the Pools page, you can see right away 3 simple ways to stake CAKE:

  1. IFO CAKE
  2. Auto Stake
  3. Manual Stake

Of the 3, you may have noticed the first two: IFO and Auto Stake pay about the same and a little more than Manual. With IFO stake, you are staking your CAKE for a chance to participate in an Initial Farm Offering when a new farm lists on PancakeSwap. Aggressive yield farmers would like that chance to get in early before rates normalize. And you are paid in CAKE for it.

Auto and Manual stake are just if you choose to lock up your CAKE and have it automatically renew or not. There are advantages to both. Auto-pays more, but Manual gives you more flexibility.

Risks

The biggest risk is the value of CAKE. But honestly, most of that risk is reduced now thanks to its drop from $25 down to $6.50 or more than 70% in the last 6 months. Could it drop further? Sure, but we think downside risk is low at this point.

4. CTSI

Cartesi specializes in off-chain computations and linking blockchain and traditional Linux environments. They are a Layer 2 solution and an oracle. So they have lots of cool things going for them.

CTSI is down almost 60% in the last 90 days. And that’s actually better than most of the market is doing. So maybe there’s some reduced downside risk here. We even wrote an article with 10 reasons why we like Cartesi and all these reasons still apply.

To build scalable smart contracts with Linux instead of Solidity that EVM requires is a smart, strategic move. It opens up many more developers to be able to develop blockchain apps. And all need CTSI to run them and for fees.

Why Stake CTSI Instead of Others with Higher APY?

You can stake directly from your wallet without giving up custody of your coins. 32% of the circulating supply is staking already on Cartesi, so something in their formula is working, and you can earn up to 49% for doing so.

As we said, price performance is a risk. You are staking and holding CTSI. We don’t see a ton of downside risk. 

Another Optimistic roll-up or other type of Layer 2 roll-up could take over and become the dominant technology. But we like where Cartesi is positioned in the market and not reliant only on their oracles.

5. MIR

Last, we have Mirror Protocol. If you like a little drama and controversy with your investments, then you’ll love Mirror. Did you hear about the federal subpoena issued during last year’s Messari Mainnet conference?

The one served with that subpoena that got everyone in crypto so mad? Terra Labs CEO and Co-founder Do Kwon. Terra Labs is the development team behind Terra Luna, their UST stablecoin and Mirror. And Mirror’s relationship with US securities is why he got the subpoena, as you will see coming up.

Mirror is called Mirror because you can trade in mirrored or synthetic assets of many US stocks. Stocks like Amazon, FB, Google, Coke, Microsoft, and Twitter as well as mirrored versions of BTC, ETH, DOT, and the S&P 500. Mirror is its payment and governance token. The SEC in the US thinks these synthetic assets are securities too, since the underlying stocks are. Thus, the subpoena for Kwon.

Another cool aspect to this protocol is the long and short farm. You earn MIR with both, but imagine if you think Twitter’s stock is going to fall. You can short farm mTWTR and earn 15% while you wait to see if you are right. Or if you like Twitter, long farm it and earn 19% while holding mTWTR as an investment. Pretty cool and all paid in MIR.

We are generally bullish on Terra’s DeFi apps, as you can see from some of this recent coverage. Mirror both has its own utility for voting on governance issues on the protocol and as a payment coin. You earn a piece of all the fees Mirror generates.

And if neither of those things interest you, it’s super easy to swap out through your Terra wallet to LUNA or UST, 2 coins we also like.

Why Stake MIR Instead of Others with Higher APY?

With MIR right now, you can stake and earn 33%. We think the risk/reward ratio for Mirror is favorable for us.

We would not call this a risk, but it’s much easier and simpler to stake MIR if you have a native Terra wallet. You can do it with a WalletConnect wallet too, but it will be easier with a native wallet like the Terra Station wallet.

Despite our love for the Terra DeFi ecosystem, there is a risk here with it. That risk is the interconnectedness of all the apps and tokens. If something bad happened to UST or LUNA, or something bad occurred on the Anchor Protocol, we could easily see MIR’s price suffer in sympathy whether they are directly affected or not. We think this risk is minor, but it is there.

So here you have our interesting and diverse list of great staking options right now. If you believe exchanges will continue to do well since they collect fees from traders whether the markets rise or fall as long as they trade, then our 2 exchange coins Uniswap and PancakeSwap might be for you.

If you are bullish on games, then you might like Axie. Also, if you are bullish on Web 3 and building dApps, then Cartesi could be a good choice. However, if you like DeFi, especially DeFi on Terra, then Mirror is worth a look. Moreover, if you like getting research like this, then click on Subscribe and ding that bell. Therefore, that way you will never miss an update.

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