Revolut introduces crypto staking in the UK
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Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.
What are the key risks?
1. You could lose all the money you invest
- The performance of most cryptoassets can be highly volatile, with their value dropping as quickly as it can rise. You should be prepared to lose all the money you invest in cryptoassets.
- The cryptoasset market is largely unregulated. There is a risk of losing money or any cryptoassets you purchase due to risks such as cyber-attacks, financial crime and firm failure.
2. You should not expect to be protected if something goes wrong
- The Financial Services Compensation Scheme (FSCS) doesn't protect this type of investment because it's not a 'specified investment' under the UK regulatory regime – in other words, this type of investment isn't recognised as the sort of investment that the FSCS can protect. Learn more by using the FSCS investment protection checker.
- The Financial Ombudsman Service (FOS) will not be able to consider complaints related to this firm or Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA regulated firm, FOS may be able to consider it. Learn more about FOS protection here.
3. You may not be able to sell your investment when you want to
- There is no guarantee that investments in cryptoassets can be easily sold at any given time. The ability to sell a cryptoasset depends on various factors, including the supply and demand in the market at that time.
- Operational failings such as technology outages, cyber-attacks and comingling of funds could cause unwanted delay and you may be unable to sell your cryptoassets at the time you want.
4. Cryptoasset investments can be complex
- Investments in cryptoassets can be complex, making it difficult to understand the risks associated with the investment.
- You should do your own research before investing. If something sounds too good to be true, it probably is.
5. Don't put all your eggs in one basket
- Putting all your money into a single type of investment is risky. Spreading your money across different investments makes you less dependent on any one to do well.
- A good rule of thumb is not to invest more than 10% of your money in high-risk investments.
If you are interested in learning more about how to protect yourself, visit the FCA's website here.
For further information about cryptoassets, visit the FCA's website here.
Revolut continues its crypto push and introduces staking for UK users.
Challenger banking giant Revolut has rolled out crypto staking to customers in the UK.
Since the fintech was accepted onto the Financial Conduct Authority’s (FCA) full register of cryptoasset firms in September 2022, we’ve seen a series of new crypto launches including the introduction of a crypto debit card and now crypto staking.
Revolut’s crypto general manager Emil Urmanshin said “Staking is our first milestone on our 2023 roadmap and we’re really excited to help users put their crypto to work and earn returns on their balances.”
How does Revolut’s crypto staking work?
The digital challenger says customers can earn up to 11.65% annual percentage yield (APY) in crypto rewards, with variations in the “payout, cadence, and required minimum time to stake” depending on which token is being staked.
Initially, the feature is only available using Ethereum (ETH), Cardano (ADA), Polkadot (DOT) and Tezos (XTZ). Finder has produced guides to staking – for example, how to stake Ethereum.
At the time of writing, Revolut’s app displayed options to stake Tezos and earn up to 4.40% APY or stake Cardano and earn up to 3.24% APY.
The reward you receive varies based on network conditions and isn’t guaranteed. When you receive your staking rewards will also depend on which token you’ve staked, as some have a protocol-imposed waiting period.
Are there any fees?
Revolut charges a staking rewards commission. Its current commission rates are as follows:
- ETH – 15%
- ADA – 20%
- DOT – 25%
- XTZ – 30%
The APY displayed in the app will include the commission.
More crypto to come from Revolut?
Revolut shows no sign of slowing down the expansion of its crypto services, unlike some other exchanges. In August 2022 it listed 13 crypto-related positions as part of its plan to grow its crypto workforce by 20%.
In recent months it has reduced its crypto trading fees, added more crypto coins to its app and introduced a crypto debit card. It’s expected that in 2023, we’ll see more crypto product launches from Revolut as well as enhancements to existing crypto products to allow users to do more with their crypto.
*Cryptocurrencies aren't regulated in the UK and there's no protection from the Financial Ombudsman or the Financial Services Compensation Scheme. Your capital is at risk. Capital gains tax on profits may apply.
Cryptocurrencies are speculative and investing in them involves significant risks - they're highly volatile, vulnerable to hacking and sensitive to secondary activity. The value of investments can fall as well as rise and you may get back less than you invested. Past performance is no guarantee of future results. This content shouldn't be interpreted as a recommendation to invest. Before you invest, you should get advice and decide whether the potential return outweighs the risks. Finder, or the author, may have holdings in the cryptocurrencies discussed.