Dogechain Explains - What is Staking.

11 Dec 2022, 12:52

Dogechain Explains - What is Staking? 🔐 Since the 14th of November, users can stake their $DC tokens on #Dogechain and get access to passive yields for actively participating in the ecosystem. But what does staking mean and how does it work behind the curtains? 🤝 Blockchains use various consensus mechanisms to validate transactions and secure their networks. The most popular ones are Proof of Work (Bitcoin, Dogecoin) and Proof of Stake (Ethereum, Dogechain). 🌿 PoS is considered more scalable and eco-friendly than PoW 💰 Staking offers crypto holders a way of putting their digital assets to work and earning passive income without needing to sell them. On a technical level, staking is used to select honest participants and verify new blocks of data being added to the network. 🛡 Moreover, locking tokens ensures that the blockchain remains secure, as it becomes increasingly expensive to attack it. Two distinct actors interact in this mechanism: 1️⃣ Validators 🔹 Lock a large number of tokens to get the right to confirm transactions and create blocks through consensus. 🔹 Receive token rewards for their service and distribute a portion of these rewards to delegators. 🔪 To ensure honest participation, validators can be penalized by the protocol if they show malicious or dishonest behavior on the chain. 2️⃣ Delegators 🔹 Delegate their tokens to a validator of their choice to increase the safety of the network. 🔹 Receive a portion of the token rewards for entrusting their tokens with the chain. 🥜 In a nutshell, users lock their tokens to participate in running the blockchain and maintaining its security. In exchange, they earn rewards proportional to the amount of their stake. 🤑 Have you staked your $DC yet? Get started here: 🌐 ♻️ Dogechain is bringing DeFi & long awaited utility to Dogecoin. Join the family! 🚀 Website I Twitter I Discord I TikTok I Reddit I Blog I Instagram