Staking (from the word *stake* \u2014 «share,» «bet») is the process of supporting the operation of a blockchain by holding cryptocurrency in a crypto wallet or on a specialized platform (exchange, DeFi platform) in order to earn rewards in the form of cryptocurrency.<\/p>\n
The staking process involves «placing» (or «freezing») cryptocurrency to support the blockchain network, generate new blocks, and facilitate transactions. The cryptocurrency owner provides their tokens to a platform or exchange for a specific period (ranging from 30 to 180 days). In return, the owner receives a reward in the form of tokens, typically paid in the same cryptocurrency.<\/p>\n
In other words, staking is a type of deposit expressed in cryptocurrency.<\/p>\n
The process of cryptocurrency mining and ensuring the correct operation of the blockchain is called **Proof-of-Stake (PoS)**. Therefore, staking is only possible for cryptocurrencies that operate on the PoS protocol, such as Kava<\/a>, Cosmos, Ethereum, and Near. For Bitcoin, this format is not possible because it operates on the **Proof-of-Work (PoW)** protocol. This means that mining in Bitcoin is done through the work of miners, not through staking.<\/p>\n If Bitcoin staking becomes available, it will typically not exceed 1%, and such an option is provided individually by the platform or exchange.<\/p>\n There are several types of staking:<\/p>\n 1. Fixed Staking Can tokens be withdrawn early? Yes, but if the owner decides to withdraw tokens before the end of the period, they will receive them within 24-48 hours and will not receive the reward for the entire period. (For example, if tokens are locked for 60 days but withdrawn on the 46th day, the 1 token accumulated for the remaining 14 days will not be paid out.)<\/p>\n 2. Flexible Staking 3. Liquid Staking In the next part, we will look at a practical example of how and where to stake coins, and we will analyze whether it is profitable and worth staking your tokens.<\/p>\n <\/p>\n
\n In this variation, the owner provides their tokens for staking or «freezing» for a fixed period. This can range from 30 to 180 days, depending on the exchange. The longer the staking period, the higher the fixed reward percentage.<\/p>\n
\n In this type of staking, owners can freely manage their assets. This type of staking does not require freezing assets: the owner can withdraw tokens at any time without losing the accumulated rewards. However, this type of staking offers a very low reward percentage. Flexible staking can also periodically change the reward percentage. For example, today USDT on staking might give 7% per year, but tomorrow the percentage could be higher or lower. Rewards are calculated daily.<\/p>\n
\n In this form of staking, the locked tokens can be used as collateral to receive a loan or other financial instruments within the decentralized finance (DeFi) sector.<\/p>\n