As the world becomes increasingly digitised, many individuals look at assets in the form of cryptocurrency. However, with a collection of these digital assets come strategies to gain rewards. Here, we look at some of the top cryptocurrencies for staking.
For more information on the best cryptocurrencies to invest in see here and here. Staking was an option available only to sophisticated crypto investors until recently. Now lots of trading platforms allow you to stake.
Cryptocurrency staking involves the holding or locking of a number of assets/coins in your wallet to earn the ability to verify transactions, secure the network and gain a profit.
Essentially, staking cryptocurrencies works by using the proof-of-stake (PoS) consensus mechanism implemented by blockchain networks. Thus, this ensures crypto networks are in agreement and verifies all transactions. While this process occurs, your staked crypto becomes part of this consensus-checking process.
Solana (SOL) refers to a smart contracts blockchain platform designed to deploy decentralized applications known as dapps. It uses SOL cryptocurrency. Additionally, these rewards depend on Solana’s adjusted staking yield.
Currently, the annual percentage yield (APY) for delegated staking amounts to 6.41%, with a larger number of validators charging around a 10% commission.
Cardano (ADA) pertains to a “third-generation” blockchain program designed for building and running smart contracts. It uses ADA cryptocurrency. Therefore, a delegate staking 1,000 ADA would earn around 46.08 ADA (4.61% APY). On the other hand, a delegate running a stake pool could earn about 77,185.05 ADA (7,718.51% APY).
Polkadot (DOT) includes an interoperability protocol blockchain that allows parallel transaction processing and exchange of data. The native cryptocurrency is DOT. According to Hodlpolkadot (https://www.holdpolkadot.com/post/5-best-places-to-stake-polkadot#viewer-6fba9). Thus, the median APY for a nominator comes to about 13.5%.
An upgrade to the original Ethereum protocol uses ETH as its cryptocurrency. Rewards depend on the amount of ETH staked. The higher the amount of ETH staked, the reward decreases and vice versa. However, participants are awarded network rewards (a portion of daily transaction fees). Therefore, the annual percentage rate (APR) of staking Ethereum amounts to 5%, currently.
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