Staking is the Preferred Way for Hodlers to Profit Even in Bear Markets
- The value proposition of Proof of stake is extending beyond mining into trading and investments.
Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamper with. The Evolution of BlockchainBlockchain was originally invented by an individual or group of people under the name of Satoshi Nakamoto in 2008. The purpose of blockchain was originally to serve as the public transaction ledger of Bitcoin, the world’s first cryptocurrency.In particular, bundles of transaction data, called “blocks”, are added to the ledger in a chronological fashion, forming a “chain.” These blocks include things like date, time, dollar amount, and (in some cases) the public addresses of the sender and the receiver.The computers responsible for upholding a blockchain network are called “nodes.” These nodes carry out the duties necessary to confirm the transactions and add them to the ledger. In exchange for their work, the nodes receive rewards in the form of crypto tokens.By storing data via a peer-to-peer network (P2P), blockchain controls for a wide range of risks that are traditionally inherent with data being held centrally.Of note, P2P blockchain networks lack centralized points of vulnerability. Consequently, hackers cannot exploit these networks via normalized means nor does the network possess a central failure point.In order to hack or alter a blockchain’s ledger, more than half of the nodes must be compromised. Looking ahead, blockchain technology is an area of extensive research across multiple industries, including financial services and payments, among others. Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamper with. The Evolution of BlockchainBlockchain was originally invented by an individual or group of people under the name of Satoshi Nakamoto in 2008. The purpose of blockchain was originally to serve as the public transaction ledger of Bitcoin, the world’s first cryptocurrency.In particular, bundles of transaction data, called “blocks”, are added to the ledger in a chronological fashion, forming a “chain.” These blocks include things like date, time, dollar amount, and (in some cases) the public addresses of the sender and the receiver.The computers responsible for upholding a blockchain network are called “nodes.” These nodes carry out the duties necessary to confirm the transactions and add them to the ledger. In exchange for their work, the nodes receive rewards in the form of crypto tokens.By storing data via a peer-to-peer network (P2P), blockchain controls for a wide range of risks that are traditionally inherent with data being held centrally.Of note, P2P blockchain networks lack centralized points of vulnerability. Consequently, hackers cannot exploit these networks via normalized means nor does the network possess a central failure point.In order to hack or alter a blockchain’s ledger, more than half of the nodes must be compromised. Looking ahead, blockchain technology is an area of extensive research across multiple industries, including financial services and payments, among others. Read this Term technology and its application in Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the networks which are used to authenticate blockchain technology. Cryptocurrencies can be thought of as systems that accept online payments which are denoted as “tokens.” Tokens are represented as internal ledger entries in blockchain technology while the term crypto is used to depict cryptographic methods and encryption algorithms such as public-private key pairs, various hashing functions, and an elliptical curve. Every cryptocurrency transaction that occurs is logged in a web-based ledger with blockchain technology.These then must be approved by a disparate network of individual nodes (computers that maintain a copy of the ledger). For every new block generated, the block must first be authenticated and confirmed ‘approved’ by each node, which makes forging the transactional history of cryptocurrencies nearly impossible. The World’s First CryptoBitcoin became the first blockchain-based cryptocurrency and to this day is still the most demanded cryptocurrency and the most valued. Bitcoin still contributes the majority of the overall cryptocurrency market volume, though several other cryptos have grown in popularity in recent years.Indeed, out of the wake of Bitcoin, iterations of Bitcoin became prevalent which resulted in a multitude of newly created or cloned cryptocurrencies. Contending cryptocurrencies that emerged after Bitcoin’s success is referred to as ‘altcoins’ and they refer to cryptocurrencies such as Bitcoin, Peercoin, Namecoin, Ethereum, Ripple, Stellar, and Dash. Cryptocurrencies promise a wide range of technological innovations that have yet to be structured into being. Simplified payments between two parties without the need for a middle man is one aspect while leveraging blockchain technology to minimize transaction and processing fees for banks is another. Of course, cryptocurrencies have their disadvantages too. This includes issues of tax evasion, money laundering, and other illicit online activities where anonymity is a dire ingredient in solicitous and fraudulent activities. By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the networks which are used to authenticate blockchain technology. Cryptocurrencies can be thought of as systems that accept online payments which are denoted as “tokens.” Tokens are represented as internal ledger entries in blockchain technology while the term crypto is used to depict cryptographic methods and encryption algorithms such as public-private key pairs, various hashing functions, and an elliptical curve. Every cryptocurrency transaction that occurs is logged in a web-based ledger with blockchain technology.These then must be approved by a disparate network of individual nodes (computers that maintain a copy of the ledger). For every new block generated, the block must first be authenticated and confirmed ‘approved’ by each node, which makes forging the transactional history of cryptocurrencies nearly impossible. The World’s First CryptoBitcoin became the first blockchain-based cryptocurrency and to this day is still the most demanded cryptocurrency and the most valued. Bitcoin still contributes the majority of the overall cryptocurrency market volume, though several other cryptos have grown in popularity in recent years.Indeed, out of the wake of Bitcoin, iterations of Bitcoin became prevalent which resulted in a multitude of newly created or cloned cryptocurrencies. Contending cryptocurrencies that emerged after Bitcoin’s success is referred to as ‘altcoins’ and they refer to cryptocurrencies such as Bitcoin, Peercoin, Namecoin, Ethereum, Ripple, Stellar, and Dash. Cryptocurrencies promise a wide range of technological innovations that have yet to be structured into being. Simplified payments between two parties without the need for a middle man is one aspect while leveraging blockchain technology to minimize transaction and processing fees for banks is another. Of course, cryptocurrencies have their disadvantages too. This includes issues of tax evasion, money laundering, and other illicit online activities where anonymity is a dire ingredient in solicitous and fraudulent activities. Read this Term have its fault-tolerant security rooted in the consensus mechanisms.
The consensus mechanism of a blockchain provides the necessary agreement on a single data value or a single state for that blockchain network.
The two most popular consensus mechanisms are Proof of Work (PoW) and Proof of State (PoS). The Proof of Work consensus is the oldest consensus mechanism and it is used on the Bitcoin Blockchain.
Proof of Stake, (promoted by the Ethereum network) was developed to address some of the inherent risks in the PoW consensus mechanism.
Proof of Stake is built around the idea that that the number of block transactions that a person can validate or mine on a blockchain is directly proportional to the number of coins he or she holds.
This piece provides insight into how the value proposition of Proof of stake is gradually extending beyond mining into trading and investments as cryptocurrency investors continue to grapple with market volatility.
Cryptocurrencies are still in a bear hug, but longs can still profit
It is easy to place profitable cryptocurrency trades and investments during a bull market. It doesn’t require any special knowledge, effort, or experience to buy low and sell high.
The crypto bull run 2017 in which bitcoin outperformed other asset classes is a case in point on how everybody can easily become be an ‘expert’ trader and investor during an extended bull run.
However, when cryptocurrencies find themselves in a bear market, traders tend to get burned, investors see a significant value of their portfolio being wiped out, and new money hesitates to enter the market.
The 2018 bear market is a good example of how fast the value of cryptocurrencies can be eroded relative to traditional assets during a bear market.
Interestingly, during a bear market, smart traders tend to take the shorting route and they might even add leverage/margin trading to increase their profits.
Unfortunately, long-term investors don’t seem to have any cards to play in a bear market.
Hence, many long-term hodlers are usually forced to stay put during a bear market in the hopes that the market will eventually return to bullish ways.
Introducing token staking
Staking your tokens on a PoS Blockchain involves locking up your crypto holdings as collateral for network resources to compete for and to add the next block to the chain.
Staking provides a financial incentive for people to provide the network resources for validating transactions and for maintaining the integrity of networks services.
Investors who stake their tokens typically earn rewards for staking in the cryptocurrency, market similar to the way people earn dividends and interest on stocks or bonds on Wall Street.
Long-term hodling investors typically leave their cryptocurrencies unused and unmoved in their wallets.
Hence, the fact that staking provides returns denominated in the asset being staked irrespective of market conditions makes it a better way to maintain a long position while also earning returns without risking the funds in a market trade.
One of the top-performing tokens in the market is the DAPP token, which is the native token of LiquidApps (DAPP Network). The DAPP token has a total supply of 1,000,000,000 DAPPs, its token generation has started since Feb 26, 2019, and it will end on Jan 25, 2020.
One of the key facts that make DAPP token a top-performing staking token is the fact that investors staking the DAPP token can expect a nice return of about 9% annually.
For long-term crypto hodlers, staking the DAPP token for a decent 9% annual return is a nice low-risk use case compared to low-risk traditional and crypto investments. For instance, people who stake on NEO can only expect a 5.5% annual return on their portfolio.
The best part is that staking DAPP token is a simple process that involves navigating to the “dappservices” account, selecting the “selectpkg” action, and filling in the required information.
Afterward, you’ll need to execute a “stake” command and you can expect to start earning interest based on the number of tokens you are staking.
When you are done staking, you’ll execute the “unstake” command and input the same parameters you provided while staking.
Staking is a win-win whether you are trading or holding
Last week Binance, one of the biggest cryptocurrencies by trading volume revealed that it has launched a crypto lending business to enable long-term holders to earn more rewards from maintaining their positions.
Binance Lending functionally allow holders to stake their coins in the market to earn guaranteed rewards irrespective of how the market moves.
Binance Lending will freeze staked amount during the crypto lending period, and it will unfreeze the principal staked and interest accrued on the redemption date of the contract.
Celsius is another crypto startup that is built around the idea that long-term hodler should be able to record additional rewards on their portfolios beyond basic price gains.
With Celsius, holders can earn interest on their cryptocurrency holdings and they can borrow against such positions without paying any fees. Celsius says it has originated about $2.2B in loans disbursed to more than 40,000 wallets.
The rising popularity of staking suggests that long-term hodlers can earn guaranteed low-risk returns on their portfolios.
In addition, traders who want to take a break from the rollercoaster volatility of active trading can still take advantage of staking to profit irrespective of whether cryptocurrencies are trading up, down or sideways.
Disclaimer: This is a contributed article and should not be taken as investment advice
Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamper with. The Evolution of BlockchainBlockchain was originally invented by an individual or group of people under the name of Satoshi Nakamoto in 2008. The purpose of blockchain was originally to serve as the public transaction ledger of Bitcoin, the world’s first cryptocurrency.In particular, bundles of transaction data, called “blocks”, are added to the ledger in a chronological fashion, forming a “chain.” These blocks include things like date, time, dollar amount, and (in some cases) the public addresses of the sender and the receiver.The computers responsible for upholding a blockchain network are called “nodes.” These nodes carry out the duties necessary to confirm the transactions and add them to the ledger. In exchange for their work, the nodes receive rewards in the form of crypto tokens.By storing data via a peer-to-peer network (P2P), blockchain controls for a wide range of risks that are traditionally inherent with data being held centrally.Of note, P2P blockchain networks lack centralized points of vulnerability. Consequently, hackers cannot exploit these networks via normalized means nor does the network possess a central failure point.In order to hack or alter a blockchain’s ledger, more than half of the nodes must be compromised. Looking ahead, blockchain technology is an area of extensive research across multiple industries, including financial services and payments, among others. Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamper with. The Evolution of BlockchainBlockchain was originally invented by an individual or group of people under the name of Satoshi Nakamoto in 2008. The purpose of blockchain was originally to serve as the public transaction ledger of Bitcoin, the world’s first cryptocurrency.In particular, bundles of transaction data, called “blocks”, are added to the ledger in a chronological fashion, forming a “chain.” These blocks include things like date, time, dollar amount, and (in some cases) the public addresses of the sender and the receiver.The computers responsible for upholding a blockchain network are called “nodes.” These nodes carry out the duties necessary to confirm the transactions and add them to the ledger. In exchange for their work, the nodes receive rewards in the form of crypto tokens.By storing data via a peer-to-peer network (P2P), blockchain controls for a wide range of risks that are traditionally inherent with data being held centrally.Of note, P2P blockchain networks lack centralized points of vulnerability. Consequently, hackers cannot exploit these networks via normalized means nor does the network possess a central failure point.In order to hack or alter a blockchain’s ledger, more than half of the nodes must be compromised. Looking ahead, blockchain technology is an area of extensive research across multiple industries, including financial services and payments, among others. Read this Term technology and its application in Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the networks which are used to authenticate blockchain technology. Cryptocurrencies can be thought of as systems that accept online payments which are denoted as “tokens.” Tokens are represented as internal ledger entries in blockchain technology while the term crypto is used to depict cryptographic methods and encryption algorithms such as public-private key pairs, various hashing functions, and an elliptical curve. Every cryptocurrency transaction that occurs is logged in a web-based ledger with blockchain technology.These then must be approved by a disparate network of individual nodes (computers that maintain a copy of the ledger). For every new block generated, the block must first be authenticated and confirmed ‘approved’ by each node, which makes forging the transactional history of cryptocurrencies nearly impossible. The World’s First CryptoBitcoin became the first blockchain-based cryptocurrency and to this day is still the most demanded cryptocurrency and the most valued. Bitcoin still contributes the majority of the overall cryptocurrency market volume, though several other cryptos have grown in popularity in recent years.Indeed, out of the wake of Bitcoin, iterations of Bitcoin became prevalent which resulted in a multitude of newly created or cloned cryptocurrencies. Contending cryptocurrencies that emerged after Bitcoin’s success is referred to as ‘altcoins’ and they refer to cryptocurrencies such as Bitcoin, Peercoin, Namecoin, Ethereum, Ripple, Stellar, and Dash. Cryptocurrencies promise a wide range of technological innovations that have yet to be structured into being. Simplified payments between two parties without the need for a middle man is one aspect while leveraging blockchain technology to minimize transaction and processing fees for banks is another. Of course, cryptocurrencies have their disadvantages too. This includes issues of tax evasion, money laundering, and other illicit online activities where anonymity is a dire ingredient in solicitous and fraudulent activities. By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the networks which are used to authenticate blockchain technology. Cryptocurrencies can be thought of as systems that accept online payments which are denoted as “tokens.” Tokens are represented as internal ledger entries in blockchain technology while the term crypto is used to depict cryptographic methods and encryption algorithms such as public-private key pairs, various hashing functions, and an elliptical curve. Every cryptocurrency transaction that occurs is logged in a web-based ledger with blockchain technology.These then must be approved by a disparate network of individual nodes (computers that maintain a copy of the ledger). For every new block generated, the block must first be authenticated and confirmed ‘approved’ by each node, which makes forging the transactional history of cryptocurrencies nearly impossible. The World’s First CryptoBitcoin became the first blockchain-based cryptocurrency and to this day is still the most demanded cryptocurrency and the most valued. Bitcoin still contributes the majority of the overall cryptocurrency market volume, though several other cryptos have grown in popularity in recent years.Indeed, out of the wake of Bitcoin, iterations of Bitcoin became prevalent which resulted in a multitude of newly created or cloned cryptocurrencies. Contending cryptocurrencies that emerged after Bitcoin’s success is referred to as ‘altcoins’ and they refer to cryptocurrencies such as Bitcoin, Peercoin, Namecoin, Ethereum, Ripple, Stellar, and Dash. Cryptocurrencies promise a wide range of technological innovations that have yet to be structured into being. Simplified payments between two parties without the need for a middle man is one aspect while leveraging blockchain technology to minimize transaction and processing fees for banks is another. Of course, cryptocurrencies have their disadvantages too. This includes issues of tax evasion, money laundering, and other illicit online activities where anonymity is a dire ingredient in solicitous and fraudulent activities. Read this Term have its fault-tolerant security rooted in the consensus mechanisms.
The consensus mechanism of a blockchain provides the necessary agreement on a single data value or a single state for that blockchain network.
The two most popular consensus mechanisms are Proof of Work (PoW) and Proof of State (PoS). The Proof of Work consensus is the oldest consensus mechanism and it is used on the Bitcoin Blockchain.
Proof of Stake, (promoted by the Ethereum network) was developed to address some of the inherent risks in the PoW consensus mechanism.
Proof of Stake is built around the idea that that the number of block transactions that a person can validate or mine on a blockchain is directly proportional to the number of coins he or she holds.
This piece provides insight into how the value proposition of Proof of stake is gradually extending beyond mining into trading and investments as cryptocurrency investors continue to grapple with market volatility.
Cryptocurrencies are still in a bear hug, but longs can still profit
It is easy to place profitable cryptocurrency trades and investments during a bull market. It doesn’t require any special knowledge, effort, or experience to buy low and sell high.
The crypto bull run 2017 in which bitcoin outperformed other asset classes is a case in point on how everybody can easily become be an ‘expert’ trader and investor during an extended bull run.
However, when cryptocurrencies find themselves in a bear market, traders tend to get burned, investors see a significant value of their portfolio being wiped out, and new money hesitates to enter the market.
The 2018 bear market is a good example of how fast the value of cryptocurrencies can be eroded relative to traditional assets during a bear market.
Interestingly, during a bear market, smart traders tend to take the shorting route and they might even add leverage/margin trading to increase their profits.
Unfortunately, long-term investors don’t seem to have any cards to play in a bear market.
Hence, many long-term hodlers are usually forced to stay put during a bear market in the hopes that the market will eventually return to bullish ways.
Introducing token staking
Staking your tokens on a PoS Blockchain involves locking up your crypto holdings as collateral for network resources to compete for and to add the next block to the chain.
Staking provides a financial incentive for people to provide the network resources for validating transactions and for maintaining the integrity of networks services.
Investors who stake their tokens typically earn rewards for staking in the cryptocurrency, market similar to the way people earn dividends and interest on stocks or bonds on Wall Street.
Long-term hodling investors typically leave their cryptocurrencies unused and unmoved in their wallets.
Hence, the fact that staking provides returns denominated in the asset being staked irrespective of market conditions makes it a better way to maintain a long position while also earning returns without risking the funds in a market trade.
One of the top-performing tokens in the market is the DAPP token, which is the native token of LiquidApps (DAPP Network). The DAPP token has a total supply of 1,000,000,000 DAPPs, its token generation has started since Feb 26, 2019, and it will end on Jan 25, 2020.
One of the key facts that make DAPP token a top-performing staking token is the fact that investors staking the DAPP token can expect a nice return of about 9% annually.
For long-term crypto hodlers, staking the DAPP token for a decent 9% annual return is a nice low-risk use case compared to low-risk traditional and crypto investments. For instance, people who stake on NEO can only expect a 5.5% annual return on their portfolio.
The best part is that staking DAPP token is a simple process that involves navigating to the “dappservices” account, selecting the “selectpkg” action, and filling in the required information.
Afterward, you’ll need to execute a “stake” command and you can expect to start earning interest based on the number of tokens you are staking.
When you are done staking, you’ll execute the “unstake” command and input the same parameters you provided while staking.
Staking is a win-win whether you are trading or holding
Last week Binance, one of the biggest cryptocurrencies by trading volume revealed that it has launched a crypto lending business to enable long-term holders to earn more rewards from maintaining their positions.
Binance Lending functionally allow holders to stake their coins in the market to earn guaranteed rewards irrespective of how the market moves.
Binance Lending will freeze staked amount during the crypto lending period, and it will unfreeze the principal staked and interest accrued on the redemption date of the contract.
Celsius is another crypto startup that is built around the idea that long-term hodler should be able to record additional rewards on their portfolios beyond basic price gains.
With Celsius, holders can earn interest on their cryptocurrency holdings and they can borrow against such positions without paying any fees. Celsius says it has originated about $2.2B in loans disbursed to more than 40,000 wallets.
The rising popularity of staking suggests that long-term hodlers can earn guaranteed low-risk returns on their portfolios.
In addition, traders who want to take a break from the rollercoaster volatility of active trading can still take advantage of staking to profit irrespective of whether cryptocurrencies are trading up, down or sideways.
Disclaimer: This is a contributed article and should not be taken as investment advice