If you are a cryptocurrency investor, chances are you have heard of crypto staking. The idea behind cryptocurrency staking is that it allows you to earn passive income. Several cryptocurrencies also use it to verify or confirm their transactions. Unfortunately, people often confuse the concept of staking with crypto mining. While both are likely to offer more returns than what is available on a standard savings account, the principles of crypto staking are simple, despite the somewhat complex terminology. Staking your crypto can be quite confusing at first, but it gets easier once you get the hang of it. In this article, we will share with you three steps to simplify your crypto staking journey.
1. Invest in a cryptocurrency that uses proof of stake
The first step in crypto staking is investing in the right cryptocurrency. Note that not all cryptocurrencies offer crypto staking. A cryptocurrency that requires Proof of Stake transactions is required. Here are some notable cryptocurrencies that allow staking and a brief description of each.
- Ethereum (CRYPTO:ETH) is the first cryptocurrency with a blockchain that can be programmed so developers can use it to build apps. Initially, Ethereum used a proof-of-work system. Now it’s more of a proof-of-stake model.
- Cardano (CRYPTO: ADA) is an eco-friendly cryptocurrency. It was created through peer-reviewed research and established through evidence-based methods.
- Polkadot (CRYPTO: DOT) makes it possible to integrate multiple blockchains and work together.
You should start by understanding all the proof-of-stake cryptos that catch your eye. Next, you need to understand how it works, the strike process involved and their potential strike rewards.
2. Transfer your cryptocurrency to a Blockchain wallet
Once your crypto has been purchased, it will be accessible on the exchange where you bought it. Several exchanges offer their independent staking programs with specific cryptocurrencies. In this case, the crypto can be bet exactly on the exchange. Otherwise, you will have to transfer your funds to a blockchain wallet. This is considered the safest way to store cryptocurrency. When you have recovered your wallet, select the crypto deposit option and then choose the crypto you are transferring. This will develop a wallet address. Use this wallet address to move your cryptocurrency from your account to your blockchain wallet.
3. Use a stakeout pool
Although staking works differently with each cryptocurrency, a staking pool is always beneficial. Most crypto traders use staking pools by pooling their funds to have a greater chance of rewards. However, study accessible staking pools for the crypto you can’t be essential for. Here are some factors to consider.
- Reliability: You can’t take advantage until the servers in your stakeout pools are up and running. Choose a betting pool that is active 100% of the time.
- Reasonable Fees: Many staking pools charge a minimal portion of your wagering rewards. These fees depend on the cryptocurrency, but are usually 2% to 5%.
- Size: Smaller pools are less likely to be selected to verify blocks. However, they offer more rewards because the rewards don’t have to be split as much.
Put your crypto in the pool you have selected through your wallet. This is the last step you need to take to receive rewards.
Stakeout cryptocurrency is a recommended way to earn passive income for those who have crypto assets that don’t want to use them quickly. With the steps explained in this article, you can simplify your crypto betting journey.
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