Staking in Cryptocurrency for Beginner

Ethereum cryptocurrency HODLERS have staked more than $14 billion worth of their tokens on the Ethereum 2.0 network. Ethereum 2.0 represents a fundamental change in how the Ethereum blockchain works. Since 2016, we have been involved in several crypto projects. DPOS is one of the protocol used in our cryptocurrency project. In this article, We will explain staking in cryptocurrency. 

There are many methods to verify transactions on the blockchain and avoid double spending, called consensus algorithms. The most famous two are: proof of work (POW) used by Bitcoin. And the more efficient and scalable one is proof of stake (POS). 

So, what is taking? And what are the advantages of staking? Generally, when investors intend to invest in cryptocurrencies. They think about in either mining crypto or purchasing it outright on a crypto exchange. But crypto staking or sticking coins, as it's often called is another possible alternative for the crypto curios to get assets in their wallets. 

Crypto staking is the process of locking up crypto holdings to get rewards or earn interest. Staking is a core feature of proof of stake (POS) blockchain protocols. Staking is another way to describe validating those transactions on a blockchain. Staked assets are usually held in a validator node or crypto wallet. 

Each blockchain project that incorporates a staking feature has its own policies for staking requirements and withdrawal restrictions. For example, DDKOIN is using the DPOS protocol. To receive the staking reward, users need to vote on the delegate every week. After the 4th time of votes, the user will receive the staking rewards.

Many long term crypto holders look at staking as a way of making their assets work for them by generating reward. Staking has the added benefit of contributing to the security and efficiency of the blockchain projects you support. 

You make the blockchain more resistant to attacks and strengthen its ability to process transactions by staking some of your funds. We are moving towards a more efficient world with technological advances. Yet, as cryptocurrencies increase the financial system's efficiency. 

They cannot be a causing factor of global warming. Proof of work (POW) may be more secure as a protocol but has a large energy waste. A study estimates that Bitcoin network could be using as much electricity as Denmark to validate the transaction. 

Founders of Ethereum are considering the many problem posed by POW, the consensus algorithm on which it was built. So, Ethereum has moved from POW to POS. Staking on POS networks presents a relatively stable opportunity to earn passive income on your digital asset while providing a faster, more scalable, and less energy intensive blockchain infrastructure. 

Many consider POS crucial as blockchain technology increases its scale and complexity and sets its sights on application in sophisticated markets and industries. Despite, POS algorithms are fast becoming an integral aspect of the blockchain ecosystem. 

Reference: https://youtu.be/9U9onQE8QLE 

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