What is staking and how can I receive rewards with it?

In the light of our newly released staking program, it’s worth giving some more details on what cryptocurrency staking is, how it works and how EUM holders can benefit from merely holding their coins on their staking console.

Proof-of-Work vs Proof-of-Stake

Cryptocurrencies give a possibility to exchange value on a peer-to-peer basis without having to rely on a centralized third-party such as banks to govern the deals. The code stands in place of banks and verifies transactions programmatically.

In the case of PoW-based (Proof-of-Work) digital coins such as Bitcoin and all its derivatives, new blocks are added to the blockchain via the process of mining. While this consensus algorithm is regarded as quite secure in the case of Bitcoin, it has its downsides such as high electricity consumption and low capacity. For instance, Bitcoin can only process 7 transactions per second at the maximum. Moreover, PoW-based networks with a relatively small number of miners can easily become a target to 51% attacks.

The Proof-of-Stake consensus algorithm is a better alternative as it eliminates all these drawbacks with a totally different approach. First introduced by Sunny King and Scott Nadal in 2012, it was designed to resolve the problem of energy consumption. However, its impact extends much further.

How does PoS work and why is it better than PoW?

Staking cryptocurrencies consists of three key elements: holding, contributing and receiving rewards. The logic is easier than it may seem at first glance. 

Cryptocurrency owners hold their coins and contribute to the system by validating transactions. Every staker gets a chance to do that, and the bigger the stake, the higher are the possibilities and, consequently, the rewards. With such a method, there’s no more need to consume electricity to conduct complex computations.

In addition to that, it comes with the following benefits.

1. No need to buy expensive hardware and upgrade it.
2. The impact on the environment is reduced as electricity consumption drastically decreases.
3. Coin holders get a possibility to participate in the network development by voting for developers’ proposals.
4. Investors get more predictable rewards. 

Despite all these advantages, current staking systems have their drawbacks as well. The biggest confusion for end-users comes from the general complexity of the whole process. PoS-based systems are pretty difficult to use giving hard times to not-tech-savvy users. 

Don’t despair, though. Elitium’s Staking Program is here to resolve the problem and make the process extremely user-friendly with some of its groundbreaking features.

Meet Elitium’s new Staking Program

With Elitium, staking your coins and receiving rewards will be easy as 1-2-3. In addition to the possibility to buy EUM with a normal credit card, just like you are used to from normal online purchases, we offer stable yearly rewards of up to 6.5%. 

With the all redesigned user dashboard, staking becomes accessible and easy-to-use for everyone. No need to set up nodes, worry about minimum staking amounts, time lengths, or any other catches. There is simply no technical knowledge required from the end-user. This way, everyone who has a credit card (or owns any other cryptocurrencies) can start staking today!

Want to learn more? Check out our new staking program here.