According to a leading expert, the next big thing in crypto is staking. Here is how it will work.

 

 It's risky, but some crypto investors have made an annual percentage return of more than 1000% on deposits - and huge amounts of passive income along the way. 

 

Many people have made a lot of money in cryptocurrency. Many people have also lost money. This makes identifying the next big trend to increase the value of your crypto and irl currency holdings - i.e. cash - essential, if only to protect your assets. 

Some crypto investors have earned an annual percentage return of over 1000% by "staking" and earning a large amount of passive income in the process. 

So what exactly is staking, and why is Lawant so sure it will become such a big deal? And what does this have to do with the much-anticipated Ethereum “merger” that is also falling? 

What is a bet? Staking is named for the fact that it can only be done with cryptocurrencies that run on the proof-of-stake blockchain. 

Cryptocurrencies like Bitcoin and Ether currently operate on a proof-of-work model, in which miners have to solve complex puzzles to validate transactions and generate new coins. This process requires enormous computing power and is often criticized for its environmental impact. 

Greener Options are proof of stake and Lawant is confident that staking is part of the future wave of crypto. 

With Proof of Stake, users validate transactions based on the amount of coins they contribute or stake. In return for staking more coins, users are likely to be selected to validate transactions on the network and earn higher rewards. 

This Bonus may include an annual rate of return and the exact percentage depends on the blockchain used. 

For example, once Ethereum, the blockchain that powers Ether, transitions to a proof-of-stake model due to an upgrade planned for this year, validators who wish to stake Ether can earn profits in exchange. get their support. It "melts" really excites the Ether community. The more Ether a validator invests, the more likely they are to be selected for the reward. 

Currently, Ethereum has both a proof-of-work chain and a proof-of-stake chain running in parallel. While both chains have validators, only the proof-of-work chain currently processes user transactions. Once the merge is complete, the Ethereum blockchain will transition completely to a proof-of-stake chain, known as the Beacon Chain, making proof-of-work mining obsolete. 

 

Beacon Chain already allows people who want to stake Ether to support the network and make a profit, “today it is about 4% to 5%,” Lawant said. "Once the merger is done, these profits will increase dramatically as the holding companies will start to receive additional income." Some predict 7% to 12% staking rewards after merging. 

Other blockchains, such as Solana and Cardano, have operated under Proofofstake. One could earn an estimated reward of 5.8% per year staking Solana's SOL tokens, while doing so with Polygon's MATIC could result in an estimated 19.5% reward. 

Each blockchain has different requirements for staking, as well as different risks associated with it.

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