Notes

Explore the Benefits of Staking with Staking Rewards

Staking is an umbrella term used to indicate the act of pledging your crypto-assets to a cryptocurrency protocol to earn rewards in exchange. Staking enables users to participate in securing the network by locking up tokens. Consequently, users are rewarded for securing the network in the form of native tokens.

The higher the number of crypto-assets you pledge, the higher the rewards you get. The rewards are distributed on-chain, which means the method of earning these rewards is entirely automatic. This means your crypto-assets make while you sleep! All you need to do is to stake them. While many crypto investors mine to gain more assets, another option is available to some investors: Crypto staking.

Crypto staking includes "locking up" a portion of your cryptocurrency for a while as a way of contributing to a blockchain network. In exchange, stakers can earn rewards, mainly in the form of extra coins or tokens.

Staking Rewards
You stake your crypto-assets with a PoS node (a server running the protocol stack) to validate a block of transactions. If the node you have delegated to successfully signs or attests to blocks, you receive staking rewards — thereby increasing your net crypto-assets. In case your node is unresponsive or malign (double-signing), a portion of the node’s assets, and hence your assets, can get slashed or destroyed.

There are numerous benefits and rewards to staking. Here are some of the most prominent:
Earn Additional Tokens
This is the great one - increasing your stash of coins or tokens. Stakers aren't guaranteed anything, as the means of forging new blocks and doling out rewards is randomized, but stakers do "earn interest," so to speak, by staking.

Staking is Less Resource-Intensive
As opposed to crypto mining, staking uses far fewer resources, which may help you relax at night. Plus, staking is servicing the ecosystem by making tokens rarer, which can raise the value of your holdings.

Stakers Get voting Rights and Participation
As discussed, stakers are more entrenched in a particular ecosystem or blockchain network, which may offer them more clout as to what happens next with a specific cryptocurrency. It's similar to owning stock in a company. By staking, you're getting voting rights.

Staking can be a Simple Way to Grow Holdings
For investors using an exchange, staking can be as simple as toggling a few switches to set things up. From there, they can see their holdings grow. It's a hands-off, easy and simple way to keep investing while putting in minimal effort.

The Financial Takeaway
Staking can be an excellent way for crypto investors to put their holdings to work, earning them rewards and interest. Plus, it can get you engaged in the governance and validation side of blockchain networks, which may be something of interest to specific investors.

It may be helpful to think of staking as owning a stock and earning dividends or even keeping money in a bank account and making interest. It can be a comparatively low-lift way to grow your account, but make sure to do your research and know the risks of staking before beginning.

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