In simple terms, staking crypto works as follows: an investor buys tokens and leaves them in the crypto exchange to maintain the blockchain network, and in return receives a reward in the form new coins. This is, in fact, staking crypto is similar to mining, but the proof-of-stake (PoS) consensus algorithm in the core is the main difference. A huge number of crypto startups have adopted this consensus mechanism and are actively using it.
Benefits of Staking Over Traditional Mining
Let’s start with the fact that in the case of staking, the process of receiving new coins looks as simple as possible: you keep the coins in a special wallet, and they gradually increase in number. In order to receive, for example, new bitcoins (or any other cryptocurrencies on PoW), you will have to purchase expensive equipment, organize a space and conditions for it, ventilation, and in the case of large volumes, also take care of the legal side of the issue.
To summarize, staking is a much more profitable and convenient way to increase crypto-capital than traditional mining.Now that we found out what is staking in crypto, let’s see how to practice it.
How To Get Started Staking Crypto?
In staking, as in any business, you need to consider some important nuances. For example, it is crucial to understand that there is a direct correlation between the number of purchased tokens and profit. The more coins you have, the more you can earn. The same applies to the timing: the longer you hold digital assets, the more profit you will get in the end.
Before choosing a coin, you should also consider the project’s tokenomics. Pay attention to the following characteristics:
-Acceptable inflation from staking rewards from 1% to 8%
-Reasonable stock burn rate
-Reasonable total number of tokens
-Balanced market capitalization
-Liquidity on large or at least medium-sized exchanges.
The best crypto staking platform in Europe is WhiteBIT. It offers high returns on staking coins. Check out the conditions for staking on the exchange and receive passive income by holding your assets on the platform.
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