What is staking cryptocurrencies

Staking Crypto

Cryptocurrency staking is a way to make money by blocking Proof-of-Stake (PoS) cryptocurrencies. Many people view staking as passive income.

How to make money by staking cryptocurrencies

There are two basic approaches to staking cryptocurrencies. The first involves setting up a node – a network node to process transactions in the project network as a validator. The method is suitable for members of the crypto community who are well versed in the market and the technical component of the work.

Developers of crypto projects whose coins can be staked usually publish detailed instructions on their resources for setting up and running a node. Here, for example, are instructions for starting Ethereum staking yourself.

To act as a validator, the system may ask the user to hold a large amount of cryptocurrency in their account. For example, for Ethereum solo staking you will need to lock 32 ETH (over $70 thousand), as of the time of writing this review. This amount may be unaffordable for many. Therefore, there are other options for staking crypto in the digital asset market.

The second option is delegation. It implies that the user uses a ready-made infrastructure to stake coins. This format of work in the crypto community is called Staking-as-a-Service (SaaS), which translated means “staking as a service.” In this case, the user transfers transactions for processing to a validator for a certain fee – someone who has his own node in the cryptocurrency network.

You can also stake through pools. In this case, you can start staking with almost any number of coins.

There are many staking services on the market. There are separate platforms for staking, for example NEXO.

Many crypto exchanges also offer staking services. For example, you can stake crypto on OKX.

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