What is cryptocurrency staking (earn)?
Staking in cryptocurrency refers to the process of locking up a specific amount of digital assets in a blockchain network to support its operations, such as transaction validation and security. In exchange, followers or “stakers” receive a reward in the form of more cryptocurrency. Staking is a fundamental functionality for blockchain networks using Proof of Stake (PoS) or its derivatives (Delegated Proof of Stake or DPoS, and Proof of Staked Authority or PoSA) as the base consensus algorithm.
Staking is generally considered a way to receive passive income in the crypto world, in the way earning interest is for a traditional savings account. The difference is that instead of depositing fiat, they deposit crypto and receive rewards related to the value and the time of the commitment.
Risks of staking
- Market Volatility: The value of staked tokens can fluctuate, potentially offsetting the rewards earned.
- Lock-Up Periods: Certain staking solutions have a lock-up period, meaning the staked assets cannot be withdrawn or traded during this time.
Top Cryptocurrency Exchanges Supporting Staking
- OKX (OKX is user-focused first and foremost. They relied on maximum convenience and speed of the exchange, and OKX does this very well. In addition, OKX has its own and very convenient decentralized wallet to store tokens securely.).
- CEX.io (CEX.io is a cryptocurrency exchange founded in 2013 and known for holding licenses to operate in regions where they are difficult to obtain. This demonstrates that the exchange is reliable and operates within the legal framework even in complex jurisdictions, providing users with optimal conditions for interacting with cryptocurrency.).
How do I stake on an exchange?
- Sign up: Sign up on a staking capable platform and pass KYC.
- Deposit: Send the cryptocurrency you want to stake to your exchange.
- Choose a Staking Option: Choose between flexible or locked staking based on your preference.
- Claim: Claim your staking rewards once they become available in your account.
Staking is an attractive tool for generating passive cryptocurrency income which, in addition, is beneficial for maintaining security and performance of blockchain platforms. Staking offers a chance to improve your crypto portfolio while also contributing to the decentralization of crypto.
