Since the emergence of Proof of Stake blockchains like Ethereum, staking has become integral to the crypto ecosystem. As one of the primary ways of investing in crypto, staking has evolved over time, but its essence has continued to personify “skin in the game.”
What is Staking?
- Staking crypto can be active or passive, but either way it involves "skin in the game."
- Staked tokens may be locked in a vault and run by a smart contract, or simply held in a crypto platform or wallet.
- Stakers earn an Annual Percentage Yield (APY) on their crypto for holding it aside in a wallet or vault.
- Stakers on the Quadency platform are currently earning 64% APY.
Today, we cover all the basics of crypto staking and learn how the newly launched Quadency staking system works.
What is Staking in Cryptocurrency Markets?
Crypto Staking DefinitionStaking is the act of setting aside crypto coins into a special wallet or vault in order to earn coin rewards based on the proportion of your holdings.
Skin in the gameWhen staking crypto, stakers are contributing in some way to that particular blockchain ecosystem and getting rewarded in the process. While there are various types of staking programs with many cryptocurrencies, most fall into two general types of staking:
- Proof of Stake Blockchains like Ethereum offer PoS staking, where you actively transfer your funds to a smart contract. Through the smart contract, crypto rewards are distributed according to your share of all staked tokens. PoS Staking can also enable stakers to take an active part in transaction validation or governance, which helps to secure the blockchain network while providing additional staking rewards.
- When you stake coins through crypto platforms and exchanges, it is more of a way to passively grow your digital asset holdings by simply keeping them in the platform’s specified vault. Staking also provides a way for platforms to incentivize user growth and expand token utility. Most leading crypto exchanges and platforms provide a staking program for their users.
What is APY vs. APR in Crypto?
Annual Periodic Rate (APR) and Annual Percentage Yield (APY) are ways to calculate your staking earnings:
- APR is a the annual rate earned for staking rewards and does not include compounded earnings.
- APY is the projected rate of returns earned through staking on an annual basis including compounded earnings. The more frequent the rate of compounding (i.e. daily, weekly, or monthly), the higher the APY will be in relation to the APR.
Be sure to get in on Quadency's Staking Program today by buying QUAD tokens!
Why Staking Matters and How to Get Started
Why stake crypto?Staking is important because it gives crypto investors a way to earn yield on tokens they are not actively trading. Instead of balances sitting idle on exchanges and platforms, they can earn more crypto and empower their “HODLings”.
How do you stake crypto?
- If it's a Proof of Stake coin (active staking), you'll need to send your crypto to the smart contract to earn yields.
- If staking on an exchange or platform (passive staking), simply hold your tokens in the specified wallet or vault.
- In some cases, you can select a lock-up period to earn a higher yield.
Introducing QUAD Staking in your Quadency Account
Quadency has introduced a simplified staking program for its native platform token, QUAD.
How it works
- With a free account, you can buy QUAD on the Quadency Platform and your tokens will automatically begin earning a 64% APY (APR/APY may vary in the future).
- Since QUAD Staking is not active staking through a smart contract, token yields are based on a simple balance of the QUAD tokens in the user's Quadency Account.
- Staking earnings on your QUAD are updated daily.
- View your QUAD token balance and staking earnings from the convenience of your Quadency dashboard.
Calculate how much you can earn by staking QUAD tokens with this handy tool!
Staking crypto has become a vibrant aspect of the digital economy. It gives investors an easy way to earn additional tokens while using an exchange or platform. In the process, stakers add to the viability of the platform and increase their “skin in the game” by becoming an active participant in the network.
Quadency is a cryptocurrency portfolio management platform that aggregates digital asset exchanges into one easy-to-use interface for traders and investors of all skill levels. Users access simplified automated bot strategies and a 360 portfolio view with a free account.
Disclaimer: The content of this article is for general market education and commentary and is not intended to serve as financial, investment, or any other type of advice.