How to buy ADA (Cardano) and stake it to earn rewards
Earn incremental income while holding onto (or even buying and selling) your ADA coins
If you have read my prior article, I talked about my experience buying and staking ADA. Here is how to do it:
TL;DR/ELI5: you use “real” money to buy crypto currency, point it to a pool which will earn interest automatically, and be able to convert that crypto back into “real” money any time it is needed.
For example, let’s say you bought $20 of ADA (the currency for the Cardano network). If you stake it with a stake pool, that’s the equivalent of having a magic wallet. You can pick any bank (pool) that you want for that wallet, and the wallet will automatically grow with interest based on the bank’s rates. You can change banks at any time, and put money in (or take it out) at any time. There is no risk to your money (because it’s all under your control at all times).There are further details as to where that interest is coming from (the network itself as a way to handle monetary growth and distribute the money made from transactions), how it is possible that this could be all reward and no risk, whether this is a pyramid scheme, etc., but I’ll assume you can do that sidebar research on your own.
To get started, you will need to do the following:
- BUY $ADA in a wallet that supports $USD
- MOVE it to a wallet that supports delegation
- DELEGATE it to a stake pool
And as with all things technology, there are many ways to do these steps, but here’s what I did, and what worked for me:
BUYING Crypto
The easiest way I’ve found to do this is to use Coinbase. They are now a publicly traded company and I’m comfortable connecting my bank account to the app (I’ve both bought and sold back and forth successfully without any issues.)
Download the Coinbase app or go to the Coinbase site by clicking this link:
https://coinbase.com/join/berthi_1
(This is an affiliate link...if you end up buying or selling $100 worth of bitcoin, they will give each of us an additional $10 of bitcoin. Otherwise, we’re leaving money on the table, as it were.)Buy at least 5 ADA (about $20)
You need to have a minimum of 5 ADA to stake to a pool, and this is a small enough amount to experiment with. Once you are comfortable with the rewards earned, you can always buy and move and stake more.
MOVING Crypto
Why do we need to move this? The Coinbase app/website doesn’t currently support staking ADA, and even when they do it’s likely they will only support their own pool so they can reap the rewards. To have more control, you’ll need to move it to another wallet, and I recommend Yoroi.
Install the Yoroi wallet
Go to https://yoroi-wallet.com/ to install and create a wallet here. Here are detailed instructions with pictures, if you get stuck.
You CAN save your password in a password manager, but it won’t pre-fill it out so you’ll have to keep copying and pasting it in when you need it.
When it gets to the twelve word recovery phrase, make sure you write them down (on paper) in order. This way, if you ever lose or forget or somehow mess up your password, you will be able to recover everything. I’d suggest storing this piece of paper wherever you currently store your passport.
Transfer the Cardano from your wallet in Coinbase to your wallet in Yoroi.
Click on the Receive tab in Yoroi. Copy the wallet address and go to Coinbase (or if you’re using the Coinbase app on your phone, go there).
Within Coinbase, you want to “Send”. It will ask for an address, and you should use your Yoroi address that you copied above (or try the QR code).
If you’re sending a large amount, I’d suggest starting with a minimum amount (like $3 worth) to make sure it works. Then you can send the rest as a separate transaction.
DELEGATING Crypto
Okay, to delegate it, stay in the Yoroi wallet. Once your ADA has transferred to your wallet (hit refresh to check) click on the Delegation List tab.
Search for any stake pools you have heard of. I’m not currently recommending any specific ones.
(Look at the different ones and decide for yourself who gives the better returns.)
That’s it! It takes about 20 days before you’ll start earning interest, and then you’ll get a small amount every 5 days after that.
For more information, please follow me on Twitter @jeffreality or on Instagram @jeffreality.eth. You could also tip me using Venmo @jeffreality or via jeffreality.eth …
