Are you ready to start earning some passive returns from your crypto coins through staking? If the answer is “yes,” you need to select the right cryptos because not all coins can be staked. Keep reading as we take a deeper look to answer two key questions, “what is crypto staking?” and “which are the best coins?”
What is Crypto Staking?
Staking is the process of committing and locking your proof of stake (POS) coins so that they can be used to validate transactions in their respective blockchains. Unlike in centralized organizations, such as banks, where transactions are processed by the management, blockchain networks are different. In blockchain networks, transactions are processed by computers (nodes) spread in their systems. However, these nodes must have some coins committed for processing transactions, and this is where staking comes in.
When you lock your coins for staking, it means that the node under consideration will be there to help the blockchain validate transactions. In return, you will be rewarded for the commitment. We must also indicate that you are not selling your coins. Therefore, your coins will be returned to your crypto wallet at the end of the staking period. If the coin under consideration gained some value during the staking period, you will gain even more.
1. The Best Coins for Crypto Staking in 2022
Crypto staking is another form of investment, and it is important to look for coins with high potential. So, here are the top three options that you might want to consider: Solana (SOL)
Solana (SOL) is a smart contract-based blockchain that is developed for the deployment of decentralized applications (DAPPs). Its native coin, SOL, is used for facilitating transactions on the network, especially on-chain operations. Like other coins, the cryptos are also used as a means of transferring value.
You can stake SOL either directly from your computer or through a staking pool. Staking using your own computers can be challenging because of the technical requirements. For example, you have to download the Solana client for the respective and keep the computer online for the entire staking period. It is never easy for many people. This is why you should consider the second method of using staking platforms because there is no setup required and it is possible to get started right away.
2. Cardano (ADA)
Cardano is one of the high-potential blockchains today. It is considered a third-generation blockchain network and is mainly used for designing and running smart contracts. Its native crypto, ADA, is used to incentivize the nodes involved in validating transactions on the platform.
ADA uses proof of stake (POS) protocol referred to as Ouroboros, which processes up to 250 transactions per second. However, it can increase the number to about one million transactions per second through its new hydra layer-2 scaling consensus system.
3. Polkadot (DOT)
This is a blockchain interoperability protocol designed to help link different chains through parallel transactions and data exchange processing. Its native cryptocurrency, DOT, is mainly used for validating transactions and governance. DOT and its native blockchain use nominated proof of stake (NPOS) that requires users to select the nodes to validate transactions. This is done automatically through smart contracts.
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The crypto coins we have listed above are some of the most promising options on the market today, but the list is not conclusive. You might also want to consider others such as ETH and LUNA. Using hi.com, you now have an excellent way to make passive income from crypto coins. It is easy, fast, and secure.
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