Staking of cryptocurrencies : all about how it works
Staking is an operation consisting of immobilizing your crypto-currencies on a digital wallet, in staking pools or on a crypto staking platform. The holder contributes to the proper functioning and security of the blockchain. In return, the latter recovers gains over the long term. Find out in this article how cryptocurrency staking works.
How does staking work ?
Staking, or staking in French, works on the consensus system of Proof of Stake or PoS. The operation varies from one blockchain to another and what you should know is that not all existing tokens are compatible with staking. Today, there are best place to stake Shiba INU on platforms such as Aqru, Crypto.com, Coinbase, Binance and Kucoin. More in detail, the user must hold and block a certain number of tokens to be eligible for the staking offer. The more he immobilizes a large amount of tokens, the higher his chances of being well rewarded. Thus, the blockchain considers that the stakers who have the most stakes are the most reliable. To ensure that the operation is not centered around the same validators, the latter are designated randomly by a dedicated algorithm. It should be noted that even when the assets are immobilized, they remain the property of the staker. However, he cannot use them to make transactions or transfer them to another wallet.
The performance of the staking operation
In terms of yield, the interest rate for staking cryptocurrencies depends on several factors. The more participants on the blockchain, the lower the reward. In addition, when the tokens are immobilized for a long period, the return will be significant. When it comes to calculating yield, most platforms do it based on the volume of staked cryptocurrencies. As for unstaking, or more precisely the fact of ceasing to stake a crypto-currency, the deadline is often defined by the platform when registering for the DeFi protocol. It can be defined in advance and be fixed or variable, which allows the user to unstake at any time. Depending on the platform and the chosen cryptocurrency, the unlock time can range from 7 to 30 days.