Staking is known as a new way to make money in the world of cryptocurrencies. A method that no longer needs trades, charts, and candles, and is not as complicated as them. 

In fact, staking is the best method for a person who wants to make a profit from his static money, but cannot find a trustable platform for it. Stay with us because we are going to introduce this investment platform to you.

Read a bit about POS (Proof of Work)

Before we get into staking, we need to talk a little about proof of work. Because these topics are strongly related to each other and you cannot go to the topic of stick before learning the certificate.

Proof-of-work was first used by Bit coin. This algorithm takes help from users and their hardware systems to solve complex equations to make it easy to reach the goal. This means that the participation of users makes the transactions to be confirmed in the block chain environment.

What is the most important purpose of POS?

As we mentioned before, the participation of users it the first goal of POS. so you better know that in the second step, network security depends on the activity of these users. With this trick, network security is ensured and transactions will be confirmed quickly. But why should they provide their users to the network? Because there is a third goal.

With their participation, users will also mine new tokens and add them to the network. At this point, you might ask yourself, what benefit will this work have for them? Miners will receive a portion of the newly mined token as a reward.

What is the problem of POS?

Proof-of-work algorithm is the first algorithm that was used and Bitcoin also implemented it as the first crypto market. So it is obvious that this system has problems. Its most important problem is the need for heavy hardware equipment for mining and network security.

When Bitcoin was not worth much, even home computer hardware had the ability to participate in the network and earn mining rewards. But today, its high price and the increase of miners have caused the difficulty of the network to increase and expensive and professional equipment is needed for mining.

This issue will cause a lack of resources, more energy consumption and ultimately damage to the environment. Any coin that wants to use this algorithm will end up with Bitcoin’s problem.

The birth of new method: proof of work!

After all problems we had talk about, all the different people started working together to come up with a new solution that no longer had proof-of-work problems. 

Finally, the proof of stake certificate was created with a new approach without previous problems, which provides a new solution for securing the network, confirming payments and generating new coins.

This system will bring together a group of blockchain stakeholders called validators and get help from their capital so that the system randomly selects one of them to confirm the transaction. The person who has invested the most money will have more luck in this situation.

What does Staking mean?

Now that you are familiar with the basic concepts, it is time to discuss about staking. Stake functionality is only for platforms that have Proof of Stake. In these platforms, there is no more mining and the reward for new token production is paid with proof of stake.

Staking means that validators lock a part of their money in the relevant platform for a certain period of time in order to be approved. Because they will receive money for this investment.

What are the features of profit staking?

Stick interest is like deposit interest and is a passive salary for you. That is, without needing to do anything, your money will work and make profit. This benefit is calculated depending on certain features and components.

Anyone can earn this way by locking their money in platforms that have staking functionality. Stake money is passive, which makes it a very attractive way to raise your salary.

Introducing deposit methods

In general, we can say that there are 3 main methods for staking. We will explain more about these 3 methods.

Cold Staking or freezing coins

For large capitals, this method should be used. In such a way, your money will still be locked and deposit interest will be added to it, but you will no longer have capital inside the exchange. Whenever your assets are withdrawn from the cold wallet, interest on the deposit will accrue to the assets.

We repeat once more so that you know for sure that this method is only used for big money. If you look at the List of all cryptocurrencies and staking platforms, you can easily find your investment option.

Staking by capital locking method

In this method, which is the most common way to earn profit, your amount of money must be locked in a platform. For example, consider an Iranian cryptocurrency staking platform. You must first enter the exchange and then buy the required token and coin.

You will then virtually enter the pool by locking up your money for a certain amount of time. The more days you don’t get your money and the longer your money is locked, the more interest you will receive.

Sticking in a flexible way

In this way, there is no more locking of assets and you can make withdrawals whenever you want. Trading is also possible in this way. The profit of this method is much lower than the other methods we introduced because your capital will no longer be locked to the platform.

Conclusion

Staking can make passive salary for any investment. Money that no longer needs to work because your money works for you. First, you need to find the platform you want and then invest from different tokens to get profit. Thank you for staying with us until the end of the article.