Staking Earn DeFi

How to Add Staking and Earn Features to Your Crypto Exchange

Codono Team

| February 22, 2026 | 20 min read

Why Your Crypto Exchange Needs Staking and Earn Features Now

If you run a crypto exchange and your users can only trade on your platform, you are leaving significant revenue on the table. Staking and earn features have become the highest-ROI addition any exchange operator can make — they increase user retention, grow average account balances, and generate recurring revenue that compounds over time.

In this guide, you will learn:

Why earn features are critical — the revenue math and user behavior data that make the case
Every type of earn product you can offer — fixed staking, flexible savings, lending, dual investment, and DeFi earn
Exact revenue projections for each product type at different AUM levels
Technical implementation requirements — reward engines, pool management, smart contract integration
Risk management strategies for slashing, smart contract exploits, counterparty defaults, and liquidity
Regulatory considerations across major jurisdictions
How major exchanges structure their earn products — and where you can differentiate
A phased implementation roadmap to go from zero to full earn suite

Whether you are building on crypto exchange software or extending an existing platform, this guide gives you the complete playbook for launching earn products that users actually want.

The Revenue Case for Crypto Exchange Earn Features
Complete Taxonomy of Crypto Staking and Earn Products
Revenue Model Breakdown With Real Numbers
Technical Implementation Requirements
Risk Management for Crypto Exchange Earn Products
Regulatory Compliance for Staking and Lending
Competitor Comparison: How Major Exchanges Structure Earn
User Experience Best Practices
Marketing and Retention Playbook
Phased Implementation Roadmap
Frequently Asked Questions
Conclusion and Next Steps

The Revenue Case: Why Earn Features Deliver the Highest ROI for Crypto Exchanges

Adding staking and earn products to your crypto exchange can increase total ARPU by 30-60% while simultaneously reducing user churn. No other single feature addition moves the needle this much. Here is why.

Here is a pattern that plays out constantly: an exchange operator looks at withdrawal data and notices users deposit, trade, then withdraw large chunks — usually stablecoins and ETH — to external wallets. The funds leave and do not come back for weeks. Where does the money go? DeFi. Lido. Aave. EigenLayer. Users move assets off your exchange to earn yield because you do not offer anything comparable.

Every dollar that leaves is a dollar not generating trading fees, not contributing to custody AUM, and not available for any of the other revenue streams that make exchanges profitable.

The numbers prove this is a market-wide reality: Binance Earn manages over $100 billion in assets. Coinbase’s staking revenue accounts for roughly 25% of total income. Kraken, OKX, Bybit — every major exchange treats earn products as a core business line.

How Earn Features Transform Your Exchange’s Unit Economics

The core metric to watch is ARPU (average revenue per user). On a spot-only exchange, ARPU depends entirely on trading volume. If a user trades $10,000/month at a 0.15% blended fee, that is $15/month.

Now add earn: that same user deposits $5,000 into a staking product earning 5% APY with a 15% platform commission. That is $37.50/year in pure commission revenue with near-zero marginal cost. Scale across 10,000 users and it is $375,000/year.

But the real value is what earn products do to behavior:

Increased asset retention: 20-40% higher average account balances within six months
Higher trading frequency: 15-25% increases in per-user trading volume (users earning yield check in more often)
Dramatically improved retention: A user with $10,000 locked in a 90-day staking product is not leaving for 90 days
Reduced acquisition cost: “Earn 8% on your USDT” converts far better than “trade crypto with low fees” — because every exchange claims low fees

Complete Taxonomy of Crypto Staking and Earn Products

Not all earn products are the same, and you do not need to launch all of them at once. This section covers every major product type, how it works, who it serves, and how you make money from it.

Fixed Staking (Locked Staking)

Users lock tokens for a defined period — 30, 60, 90, or 120 days — in exchange for a guaranteed APY. Tokens cannot be withdrawn until the lock expires.

How it works: You pool user deposits and either delegate them to proof-of-stake validators (for ETH, SOL, ADA, DOT) or deploy them into yield-generating strategies. The APY is fixed at subscription.

Best for: Users wanting predictable returns who are willing to sacrifice liquidity. Typically your highest-APY product because lock periods give you more deployment flexibility.

Revenue model: You earn the spread between actual staking yield and the rate you promise. If ETH staking generates 4.2% and you offer 3.5% on a 90-day lock, you keep 0.7% annualized on all locked ETH.

Flexible Staking (Flexible Savings)

Users deposit tokens and earn yield with no lock period — they can withdraw at any time with instant or next-day settlement.

How it works: Similar to a savings account. You deploy pooled funds into low-risk strategies and pass through a portion of yield. Rates are variable.

Best for: Users wanting returns on idle balances without commitment. This is your highest-adoption product because the barrier to entry is zero.

Revenue model: Lower yields (you need liquidity reserves for withdrawals) but higher participation. Typical structure: 1-3% APY on stablecoins while you earn 4-8% on deployed capital.

Crypto Lending

Users lend assets to borrowers — either peer-to-peer or to your exchange as counterparty — and earn interest.

How it works: Borrowers post 150-200% collateral. The exchange facilitates matching, manages collateral, and handles liquidations when collateral drops below thresholds.

Best for: Users comfortable with slightly more complex products. Stablecoin lending rates reach 8-15% during high-demand periods.

Revenue model: Interest rate spread (2-4 percentage points between what borrowers pay and lenders receive) plus origination fees. A lending software module handles matching, collateral management, and liquidation logic.

Dual Investment and Structured Products

Covered call or cash-secured put option writing packaged for retail users. Users commit to buying or selling a token at a specific price on a future date, earning premium yield regardless of outcome.

Best for: Experienced users comfortable with directional risk. Highest advertised APYs (30-100%+) but with meaningful risk.

Revenue model: Spread between option premiums collected and yield paid to users.

DeFi Earn and Liquidity Farming

Your exchange aggregates user deposits and routes them to vetted DeFi protocols — Aave, Compound, Lido, Curve — while users get a simple “deposit and earn” experience.

Best for: Users who want DeFi yields without managing wallets and gas fees. Our DeFi integration guide covers implementation in depth.

Revenue model: 10-20% performance fee on yields generated.

Revenue Model Breakdown for Crypto Exchange Earn Products

Here is what each earn product type looks like from a revenue perspective, with real numbers based on a mid-size exchange with $50 million in total earn AUM. These projections help you model the business case for your specific scale.

Product Type	Typical User APY	Your Gross Yield	Your Net Margin	Monthly Revenue (on $10M AUM)
Fixed Staking (PoS tokens)	3-8%	4-10%	0.5-2%	$4,100 - $16,600
Flexible Savings (stablecoins)	1-3%	4-8%	2-5%	$16,600 - $41,600
Crypto Lending	5-12%	8-18%	2-4%	$16,600 - $33,300
Dual Investment	15-80%+	Variable	3-10%	$25,000 - $83,300
DeFi Earn (aggregated)	4-10%	5-12%	10-20% of yield	$4,100 - $20,000

Real-world scenario: $50 million across these products at a blended 1.5% annualized margin generates $750,000/year — roughly $62,500/month. That is on top of trading fees, withdrawal fees, and all other revenue streams covered in our revenue models breakdown.

$50 million in earn AUM is achievable for an exchange with 20,000-50,000 active users at average deposits of $1,000-$2,500 per user in earn products. This is well within reach for a mid-stage exchange.

Technical Implementation Requirements for Crypto Exchange Staking

There are five core components you need to build for a production-ready earn product suite. This section covers the technical architecture so your engineering team knows exactly what to implement.

1. Reward Calculation Engine

The backbone of everything. It must calculate, accrue, and distribute rewards per-user, per-product, on a daily or per-second basis. Requirements:

Variable APY rate handling
Lock period tracking and enforcement
Compound vs. simple interest options
Pro-rated partial periods
Multi-currency payouts
High-precision decimal arithmetic — never floating point for financial calculations. Rounding errors compound into real discrepancies across thousands of accounts.

2. Fund Pool Management

Track proportional ownership across shared deposit pools. Handle deposits and withdrawals adjusting share ratios in real time. Route pooled funds to validators, DeFi protocols, or lending markets on the deployment side.

3. Smart Contract and Blockchain Integration

For native PoS staking, integrate with each chain’s staking mechanism — Ethereum’s Beacon Chain, Solana’s stake delegation, Cardano’s stake pools, Polkadot’s nomination system, Cosmos delegation. Each has different unbonding periods (Ethereum ~1-4 days, Polkadot 28 days, Cosmos 21 days) and reward schedules. Your system must abstract these differences behind a uniform user experience. See our best blockchain guide for chain-specific considerations.

4. Admin Dashboard for Earn Product Management

Operators need to create products, set APYs, define lock periods, monitor AUM, adjust rates, set capacity limits, and generate compliance reports — all from a proper admin dashboard. Adjusting rates through database queries is a recipe for expensive mistakes.

5. Wallet Infrastructure

Earn products require robust crypto wallet infrastructure with segregated earn wallets, hot/cold management for reserves, automated rebalancing, and multi-signature controls for large fund movements.

Build vs. Buy: The Honest Assessment

A full earn product suite takes 6-12 months of dedicated engineering. These are complex financial systems where bugs cost real money. Codono’s staking platform and earn module include the reward engine, pool management, admin controls, and user interfaces pre-built. The lending software handles collateral, liquidations, and interest calculations. You configure, set rates, and launch.

For context on the broader build-vs-buy decision, see our white-label vs custom build analysis.

Risk Management for Crypto Exchange Earn Products

Earn products create risk exposure that pure spot trading does not — if you promise 5% APY, you must generate that yield consistently. Ignoring these risks leads to user fund losses and regulatory action. Here are the four critical risks and how to mitigate them.

Slashing Risk (PoS Staking)

Validators can be penalized for misbehavior or downtime, destroying a portion of staked assets. Mitigation:

Diversify across 5-10+ validators
Set aside 1-2% of staking revenue into a slashing insurance fund
Monitor validator performance in real time
Re-delegate before underperformance becomes a slashing event

Smart Contract Risk (DeFi Earn)

Exploits in DeFi protocols can wipe out routed user funds. Mitigation:

Only use battle-tested protocols (Aave, Compound, Lido, MakerDAO)
Set per-protocol exposure limits at 20-30% of total AUM
Implement circuit breakers that auto-withdraw when anomalies are detected
Review audit reports from firms like Trail of Bits or OpenZeppelin

Counterparty Risk (Lending)

Borrower defaults where collateral does not cover the loan. Mitigation:

Require 150-200% collateralization
Implement automated liquidation at 120-130% maintenance margins
Reserve 2-5% of lending revenue for liquidation shortfalls
Cap maximum loan sizes to prevent concentration risk

Liquidity Risk (Flexible Products)

If 100% of deposits are deployed, you cannot honor instant withdrawals. Mitigation:

Keep 15-25% of flexible AUM in liquid reserves
Process small withdrawals instantly, queue large ones for T+1
If reserves drop below target, automatically reduce offered APY
Build a liquidity buffer fund from ongoing revenue

Operational risk also matters: a decimal error turning 5% APY into 50% will drain reserves fast. Two-person approval for rate changes, staging environment testing, and anomaly detection on reward distributions are essential safeguards. Your security features become even more critical when managing earn products. For a comprehensive security approach, see our enterprise security framework.

Regulatory Compliance for Crypto Exchange Staking and Lending

Earn products sit in a regulatory area that is rapidly becoming more defined. Getting this wrong can result in enforcement actions, fines, or forced shutdown. This section covers the key regulatory considerations across major jurisdictions.

The Securities Classification Question

The core issue: are your earn products securities? The SEC’s enforcement actions against Celsius, BlockFi, and Gemini Earn established that interest-bearing crypto accounts can be classified as securities.

Consult legal counsel in every jurisdiction you operate in
Native PoS staking (validating on the network) has a stronger argument for not being a security than lending products
Under MiCA in the EU, CASPs can offer staking under their existing license, though lending and structured products may require additional authorization. See our MiCA compliance guide for full details
Clear disclosure of risks, fee structures, and yield sources is both good practice and regulatory protection regardless of classification

KYC/AML and Tax Reporting for Earn Products

Users participating in earn products must be fully verified. A robust KYC/AML system that verifies identity before allowing earn participation is both a regulatory requirement and a risk management necessity.

Earn rewards create taxable events in most jurisdictions. Your platform must generate accurate records of every reward distribution — date, amount, token, fair market value — and offer downloadable reports for user tax filing. Exchanges that make tax filing easy earn genuine user loyalty.

For additional compliance context, review our KYC compliance guide and crypto exchange license guide.

How Major Crypto Exchanges Structure Their Earn Products

Understanding competitor offerings helps you position your own products competitively. This comparison shows where the market stands and where smaller exchanges can differentiate.

Feature	Binance Earn	Coinbase	Kraken	OKX	Your Exchange (with Codono)
Flexible Savings	Yes, 300+ assets	Yes, limited assets	Yes, 20+ assets	Yes, 100+ assets	Configurable, any listed asset
Fixed Staking	Yes, 30/60/90/120-day locks	No	Yes, bonding periods vary	Yes, multiple lock tiers	Yes, custom lock periods
Native PoS Staking	ETH, SOL, ADA, DOT, ATOM + more	ETH, SOL, ADA, ATOM	ETH, SOL, DOT, ADA + more	ETH, SOL, DOT + more	Any PoS chain you support
Lending	Peer-to-peer (via VIP Loan)	Limited (institutional desk)	Margin pool lending	Yes, flexible and fixed	Built-in lending module
DeFi Earn	Yes (DeFi Staking, on-chain)	Yes (limited DeFi vaults)	No	Yes (DeFi portal)	Via DeFi integration layer
Commission/Spread	5-20% of yields	25-35% of yields	15-25% of yields	5-15% of yields	You set the margin
Auto-Subscribe	Yes (flexible products)	Yes (some products)	No	Yes	Configurable
Reward Frequency	Daily	Daily or per epoch	Twice per week	Daily	Configurable (daily recommended)

Key takeaway for smaller exchanges: Differentiation is in configuration, not features. Coinbase takes 25-35% of staking yields, acceptable because of brand trust. A smaller exchange competes on yield with slimmer margins. Your advantages: faster to add new assets, more flexible lock periods, more competitive rates. Major exchanges need weeks of compliance review to add a staking asset — you can go from decision to live in days.

User Experience Best Practices for Crypto Earn Features

The best earn products in the world underperform if the user experience is poor. These UX principles directly impact conversion rates and user satisfaction.

Transparent APY Display

Be explicit about what the APY means. Is it estimated or guaranteed? Gross or net of commission? Annualized from a recent period or a forward projection? A format like “Est. APY: 5.2% (net of platform fee)” is far better than “UP TO 12% APY!!!” where the 12% is a theoretical maximum. Show historical 30-day or 90-day APY trend data to build confidence. For more UX principles, see our crypto exchange UX design guide.

Frictionless Subscription Flow

Three taps or fewer: select product, enter amount, confirm. Every additional step reduces conversion. After subscription, show concrete numbers: “Your estimated daily earnings: 0.0142 ETH ($48.30)” — dollar amounts resonate far more than abstract percentages.

Real-Time Reward Tracking

Users want to see earnings grow — total earned to date, daily summaries, active positions with remaining lock time. When a user opens your app and sees they earned $3.47 overnight, that emotional connection is worth more than any marketing campaign.

For fixed products, show the exact unlock date and offer early withdrawal with a penalty (forfeiting accrued rewards) as an escape valve. For flexible products, withdrawals should be instant or near-instant.

Marketing Crypto Exchange Earn Features: Acquisition and Retention Playbook

Earn products are among the easiest exchange features to market because the value proposition is universally understood: your money grows while you hold it. Here is how to maximize acquisition and retention.

User Acquisition Strategies for Crypto Earn Products

“Earn X% on your crypto” is one of the highest-converting messages in crypto marketing. The key is specificity: “Earn 5.2% APY on USDT” converts better than “Earn high yields” because specificity builds trust.

Welcome bonuses tied to earn products are extremely effective: “Deposit $500 and earn boosted 8% APY for your first 30 days.” The user tries the product, sees rewards accumulate, and stays. The cost of 30-day boosted rates is trivial compared to lifetime value.

Referral integration: Your referral system should tie into earn products. “Refer a friend who deposits into Earn and you both get a 30-day APY boost” creates viral loops. For more growth strategies, see our user acquisition and growth guide.

Retention Mechanics That Keep Assets on Your Platform

Tiered rewards: Users holding 90+ days get a 0.5% APY boost. Balances above $10,000 get premium rates.
Auto-subscribe for flexible products: Every idle dollar earns yield by default. This is a massive retention lever — Binance does this extremely well.
Staking milestone notifications: “You’ve earned $100 in staking rewards!” Celebrate milestones via push, email, and in-app messages.
Earning streaks and seasonal promotions: Limited-time boosted rates drive urgency without being patronizing.

Phased Implementation Roadmap for Crypto Exchange Earn Features

You do not need everything on day one. This proven sequencing minimizes risk while maximizing early revenue.

Phase 1 (Week 1-3): Flexible savings on your top 5-10 assets. Lowest risk, no lock periods, users can withdraw anytime. Even 1-2% on stablecoins is compelling for users currently earning 0%.

Phase 2 (Week 3-6): Fixed staking with 30, 60, and 90-day locks at higher rates. Start with one or two PoS assets where you have validator infrastructure or trusted delegation partners.

Phase 3 (Month 2-3): Lending. Requires both lenders and borrowers, so launch once you have critical mass. Start with USDT/USDC — stablecoin demand from margin traders is consistently high.

Phase 4 (Month 3-6): Advanced products. Dual investments, DeFi earn, and structured products. These require more sophisticated risk management and user education, so build the foundation first.

For context on overall exchange launch sequencing, see our crypto exchange launch checklist.

Frequently Asked Questions About Crypto Exchange Staking and Earn

How much capital do I need to seed crypto exchange earn products?

For native PoS staking, minimal — user deposits are staked on-chain directly. For flexible savings, budget a reserve fund of 5-15% of expected AUM. Most operators launch successfully with $50,000-$200,000 in operational reserves. For full budgeting guidance, see our cost to build a crypto exchange guide.

What if crypto staking APY rates become unsustainable?

This is why flexible-rate products are safer than fixed guarantees. Adjust rates down when yields decline, set conservative fixed rates with shorter locks, and build in review mechanisms. Never promise yields you cannot sustainably deliver — that is the path that destroyed Celsius, BlockFi, and Voyager.

How do earn features affect my exchange’s liquidity management?

Earn deposits are separate from trading liquidity, but they interact. Users move funds from trading to earn wallets, which can temporarily reduce trading liquidity. However, increased asset retention more than compensates. Many operators use flexible savings deposits to support market making and liquidity engine operations. For detailed liquidity strategies, see our liquidity management guide.

Do I need a financial license to offer crypto staking?

Requirements vary by jurisdiction. MiCA covers staking under CASP authorization in the EU. The US landscape is evolving. Singapore, Dubai, and Hong Kong have specific frameworks. Always consult local legal counsel. Our licensing guide covers the broader regulatory landscape.

How do I handle tax reporting for crypto earn rewards?

Generate detailed records of every reward distribution — date, amount, token, fair market value at time of distribution. Most jurisdictions treat earn rewards as income at receipt. Provide downloadable CSV/PDF reports.

What crypto staking APY should I offer to be competitive in 2026?

As of early 2026: ETH staking 3.0-4.5%, SOL staking 5.0-7.5%, USDT flexible 1.5-4.0%, USDT fixed 90-day 3.0-6.0%. You do not need to beat Binance — just be competitive enough that rates are not a reason to leave.

Can I offer earn products with a white-label crypto exchange?

Yes. Building earn infrastructure from scratch takes 6-12 months. A white-label exchange with pre-built modules lets you launch in weeks, fully branded as your own. See our white-label vs custom build comparison for the full analysis.

Conclusion: Launch Your Crypto Exchange Earn Features Today

Staking and earn features have moved from competitive advantage to competitive necessity. Every month you operate without them is a month where users with idle balances are looking at other platforms and thinking about moving their assets somewhere they can put them to work.

The implementation is well understood, the revenue model is proven, and the tools exist. You do not need to invent anything — you need to execute on a proven playbook with the right technology, proper risk management, and a user experience that makes earning yield effortless.

Your Next Steps

Start with flexible savings on your top 5-10 assets. Add staking. Layer in lending. Expand to advanced products as operational maturity grows.
Evaluate your platform — Does it support earn product configuration out of the box? Request a demo to see Codono’s staking and earn modules in action.
Review related guides:
- Revenue Models for Crypto Exchanges — Full revenue diversification playbook
- DeFi Integration for Centralized Exchanges — DeFi earn implementation
- Crypto Exchange Launch Checklist — End-to-end launch sequencing
- How to Choose Crypto Exchange Software — Platform evaluation framework
Contact our team to discuss earn feature implementation for your specific exchange.

The exchanges that win in 2026 and beyond are not the ones with the lowest fees or flashiest UI — they are the ones where users never have a reason to move their money somewhere else. Earn features are how you make that happen.

The Codono Team has helped exchange operators across 40+ countries implement staking and earn features. The strategies in this article are based on real operational data, not theoretical models. Check our pricing to see what is included, or talk to our team to get started.

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