You have probably heard about cryptocurrencies and the way they helped people make money in no time. Haven’t you? When the first cryptocurrency was released in 2009, many were sceptical and quick to dismiss them, but those who gave it a try now enjoy high returns on investments. If you bought just one Bitcoin (BTC) in 2009, the price was way less than one USD. Approximately 13 years down the line, the same BTC is worth about USD 40,000. There is a newer method of making more returns using Crypto Signals and blockchain: staking.
Staking is so good that many people are now running away from conventional investment to use it. In this post, we take a closer look at staking to define what it is and check important facts that you can use to make the big decision.
First Things First: What are Cryptos and Blockchain?
The term cryptocurrency is synonymous with Bitcoin for most people, but this is only a small bit. Bitcoin is famous because it is the oldest and has been accepted in many applications. However, the field of cryptos is way bigger than that.
A crypto coin is a form of digital currency, implying that it is not printed or minted the way we know conventional coins and notes. Instead, they only exist as digital money. When you buy some cryptos, what you receive is a code indicating the coins you hold. You have to use a crypto wallet, such as a hot wallet, cold wallet, or software wallet, to store the coins.
A blockchain is a decentralized database that is hosted on a network of computers. Unlike standard databases, such as those used by centralized banks, blockchain does not have any central authority. Again, information that is added to the blockchain is permanent and cannot be changed in any way. All the decisions about the blockchain are made through consensus, where the nodes must agree. This transparency has made blockchains more attractive to the finance industry and almost all other areas of the economy.
What is Staking?
Staking is the process of locking your proof of stake (POS) coins in a blockchain network so that they are used for running and maintaining the network. Mining is closely related to crypto mining, but the latter happens only on proof of work (POS) blockchains, such as Bitcoin and Bitcoin Cash. In the case of staking, only the nodes that have some stake (coins) in the respective blockchain networks are allowed to validate transactions and participate in governance-related activities like voting.
When you commit your coins, whether directly from your wallet or through a staking pool, the effort is rewarded using a portion of the fee charged on network users. For example, if you are selected to validate transactions for a person sending coins on the network, part of the fee will be channeled to your wallet.
To stake coins, there are a number of things that are needed. First, you need some coins. The more the stacked coins are, the higher the chances of getting selected to confirm transactions. This means you will also receive more return on revenue.
You also need to ensure the computer is installed with the blockchain client or the database, keep it on for the entire staking period, and be online. These conditions are never easy to meet for many people, and the best option is working with staking pools because they have the expertise and required infrastructure.
Benefits to Expect from Staking
The main benefit of using staking is that it acts as a source of passive income. Instead of letting the coins stay idle in your wallet, they can earn you more funds. Other benefits of using staking include:
- You do not sell your coins.
- An increase in the price of your coins will also deliver more returns.
- It is easy and fast to start staking and earning from your coins.
Staking has become the new go-to investment opportunity because the returns are way higher than stashing cash in a bank account. Now, this is the emerging new avenue that no one wants to miss. To get started, visit hi.com now. Hi pays up to 40% APY for investors.