Looking at your portfolio during a bear market can be a real test of stress for any investor. Between red numbers and constant falls, it is common to oscillate between the impulse to panic sell and stand still without knowing what to do. However, in the midst of this scenario, many begin to explore alternatives such as staking to remain calm and seek performance even when the market is not supportive.
However, if we look at the behavior of institutional investors and “veterans” of the ecosystem, we notice a very different pattern of behavior: When prices fall, many investors seek refuge in passive income alternatives.
This strategy, traditionally known in finance as «fixed income» or «dividends», has its technological evolution in the blockchain under the name of Staking.
With the recent price drop in the crypto market, locking cryptocurrencies to help validate the network in exchange for rewards is a mechanism that leverages idle funds without the need to sell them.
How does staking work?
In essence, staking It is the process of holding (“staking”) cryptocurrencies on a proof-of-stake network. By locking tokens, the user contributes to the verification of transactions and receives new tokens in return generated on the blockchain. This dynamic encourages the holding of digital assets and can help reduce volatility, since locked tokens temporarily stop circulating.
Besides, staking offers periodic payments– Rewards are delivered according to the frequency defined by each blockchain network. For example, in Ethereum 2.0 the generated yield is distributed after the network activation time, similar to how staking works in the Crypto.com app.
In short, staking provides a way to putting cryptocurrencies to work in times of low pricesearning additional rewards instead of leaving them idle.
Crypto.com maintains a fairly wide supply of cryptocurrencies available for stakingallowing different user profiles (from those who only own popular assets to those who work with niche tokens) to generate rewards.
The list includes highly recognized networks such as cosmos (ATOM), solana (SOL), polkadot (DOT), avalanche (AVAX), cronos (CRO), cardano (ADA), toncoin (TON), polygon (POL/MATIC), among others. Each one has specific conditions according to its protocol: some process rewards daily, others weekly and others depend on the block frequency validated on the network. This causes the user to have a slightly different experience depending on the asset they decide to lock.
The process is intuitive: just go to the staking menu, choose the asset and the amount, and confirm the operation in the app. After the activation period (which varies by network), the user begins to receive rewards in the corresponding cryptocurrency.
Additionally, Crypto.com publishes yield (APR) estimates based on the asset. These rates can range from a couple of percentage points to double-digit values. For example, currently it offers 2.7% APR for Ethereum and up to 17.87% APR for Cosmos. It is important to note that these percentages vary with network activity.
Another relevant point is that Crypto.com Allows Certain Rewards to Be Reinvested Automaticallydepending on how the network distributes incentives. In some cases, rewards are credited directly to the user’s wallet, while in others they can be added to the staked amount and start generating additional returns.
This difference is key, because it affects the “compound return” ability of staking. This mechanism is highly valued by those seeking to maximize their long-term returns without the need to intervene manually.
Advantages of staking at Crypto.com
Crypto.com highlights several advantages when using its Staking feature in the app. Among them are:
- Comfort: allows you to easily invest idle wallet funds and earn returns proportional to the blocked amount.
- Periodic payments: Rewards are received according to the protocol of each blockchain, automatically while the block is maintained.
- Flexibility: The user can cancel the “stake” at any time after the activation period required by the network has expired.
- Security: Crypto.com employs independent blockchain addresses to manage staked funds, reinforcing the security of locked assets.
These features make Crypto.com an accessible platform, both for new users and experts, integrating staking non-invasively within its application.
Benefits of staking in a bear market
In periods of decline, such as the recent market correction influenced by macroeconomic factors such as inflation and regulations, staking shines for its defensive approach, offering:
- Passive returns– Unlike active trading, which requires constant monitoring, staking generates automatic rewards. For example, staking on specialized platforms can offer on average up to 9.5% annually, which acts as a cushion against depreciation.
- Diversification and stability: By locking assets, you avoid the temptation of impulsive sales. Additionally, many platforms integrate staking with other services, such as debit cards that offer cashback in crypto. In the case of Crypto.com, locking a minimum amount of CRO unlocks higher tiers in its rewards program, including rebates on everyday services like streaming or travel, transforming an investment into a tangible daily profit.
- Contribution to sustainability– Participating in PoS helps greener networks, aligning with values of environmentally conscious investors.
Are there risks when staking?
Although the barrier to entry has decreased considerably (allowing you to participate with accessible amounts from 10 dollars and from mobile applications), staking is not without risks that every prudent investor should consider.
The main challenge remains the inherent volatility of the market. Although rewards accumulate, a drop in the token price can affect the total value of the portfolio. Added to this are the blocking periods, during which the assets remain immobilized, preventing their immediate sale in the event of sudden market movements and more complex technical risks such as «slashing» (penalties for network failures).
Finally, it is important to remember that staking return rates are subject to the activity of the validators and internal factors of the blockchain. Crypto.com uses secure validators and independent addresses to handle fundsbut it is still recommended that users consider these risks before participating.
Therefore, the strategy recommended by experts for 2025 focuses on diversification. But what is crucial is the choice of platforms that operate under strict compliance and global security standards, as in the case of Crypto.com.
In conclusion, although a possible “crypto winter” tests the patience of investors, tools such as staking and Crypto.com’s integrated solutions offer alternatives to obtain profitability from digital capital. While waiting for price recovery, users today have legitimate means to generate passive income.
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