Revolut will support staking a selection of tokens, with yields as high as 11.65%.
Neobanking challenger Revolut has just launched a staking service for proof-of-stake (PoS) tokens including Ethereum (ETH), Cardano (ADA), Polkadot (DOT), and Tezos (XTz).
Revolut is a UK-based digital banking alternative that offers services such as currency exchange, money transfer, and stock trading. It operates as a mobile app and provides access to multiple currencies, including cryptocurrencies, as well as a debit card for spending.
Staking is a process where users hold and lock up their cryptocurrency in a wallet for a certain period to support the network and validate transactions. In return for participating in this process, users are rewarded in the form of newly minted crypto or a portion of transaction fees.
The benefits of staking include:
- Passive Income: Staking can provide users with a source of passive income as they receive rewards for holding and supporting the network.
- Increased Security: By staking their cryptocurrency, users help to secure the network and prevent malicious actors from taking over the system.
- Influence: Staking can give users a say in the governance and decision-making processes of the network, allowing them to influence its future direction.
- Easier than Mining: Staking is less technical and less resource-intensive than mining, making it a more accessible option for users who want to participate in supporting a blockchain network.
Using Revolut’s service, staker can earn up to 11.65% return in crypto rewards, depending on the token staked.
For now, the new service will only be available in the UK and in select EEA countries. Eventually, Revolut plans to make more cryptocurrencies available for staking, and expand their services to more countries.
Revolut boasts over 25 million users worldwide, and has been integrating crypto services into its expansion since the end of 2017. The neobank is also currently assessing the potential benefits of launching its native cryptocurrency — the RevCoin — as soon as this year.
Revolut is a step ahead of more cautious neobanks, but the pattern of financial institutions wading into the crypto waters is evident. German banks N26 and DekaBank have recently begun offering crypto trading and retail services, while Mastercard and Unbanked announced a partnership to bring “crypto cards” to Europe.
It is clear that these banks are launching digital assets services for reasons not related to decentralization. There is a growing interest and adoption of cryptocurrency, and neobanks see an opportunity to offer these services to their customers to meet this demand. By offering crypto-related services, neobanks can differentiate themselves from traditional banks and offer unique value propositions to attract new customers, which provides an additional and potentially-torrential revenue stream, including from trading and crypto management fees.
More than anything, there’s a lot of competition in the industry, despite last year’s setbacks.