Coinbase adds support for Tezos in the UK

Written by: Ali Raza
May 30, 2020
  • Coinbase is launching Tezos staking rewards in four European countries - UK, Netherlands, France, and Spain.
  • The exchange said that US users managed to earn $2 million in staking rewards since November.
  • With staking being a great way to earn a passive income, at the same time, many are jumping to join.

Coinbase, the largest cryptocurrency exchange in the US, finally decided to start bringing Tezos (XTZ) staking rewards to Europe. The exchange will focus on the UK and three EU countries for the time being.

Coinbase’s XTZ staking is coming to Europe

The announcement of the new move came only yesterday, May 28th, when Coinbase announced that Tezos staking rewards will soon become available to four European countries. Apart from the UK, the company will provide rewards to France, the Netherlands, and Spain, as well.

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All four countries’ users can buy Tezos (XTZ) tokens and earn interest on them if they choose to deposit them on the exchange, and keep them there.

Coinbase also stated that this feature earner US users over $2 million in staking rewards since its introduction in November 2019. In other words, it represents an excellent opportunity for Tezos users to earn some passive income without having to do anything.

What is steaking and what does it do?

The concept of crypto staking became rather popular recently, but even so, it is still rather confusing for a lot of users. It only works for crypto projects whose blockchains use Proof-of-Stake (PoS) system. Basically, staking allows network participants to use their own holdings for earning interest.

The catch is that these holdings need to be locked up, which helps maintain operations on the network.

The system is considered by many to be better and more advanced than Proof-of-Work (PoW) used by projects like Bitcoin, because PoS nodes serve to validate blocks, and not mine them.

Block validators are selected based on how many tokens the node has staked. The node operator can either stake tokens on their own, or they can use a staking service — such as the one offered by Coinbase — to improve their position. So basically, Coinbase users lock away their tokens on Coinbase, which then helps node operators gain an advantage when it comes to being assigned to validate a block.

According to Coinbase, the current annual return for Tezos staking is 5%. Users will see their pending rewards increase in real-time via the Coinbase app. And, after their initial holding period completes (35–40 days), users will start receiving rewards in their Coinbase account every 3 days.

Coinbase also uses its Coinbase Custody service to provide staking support for global investors, as staking became very popular around the world, causing plenty of services to start joining the game.