In recent years, the term 'staking' has become one of the most popular words in the cryptocurrency and blockchain industry. In 2024, the liquid staking platform Lido had over $26.068 billion (approximately 8 trillion Thai baht) in staked assets, the highest amount compared to other platforms in the Web 3.0 world (according to Defillama).
In reality, staking is an investment option that allows you to reduce opportunity costs, such as simply holding coins idle, or even acts as a tool to help protect your capital from being significantly affected by inflation in the long run.
In this article, KUB will take everyone to explore what staking is, how to use KUB coins for staking, and its importance to the blockchain network.
What is Staking? Why are users increasingly interested in it?
Staking is a process where cryptocurrency or digital asset holders take their coins held in a digital wallet and lock or deposit them to support the operation of a blockchain network that uses a Proof-of-Stake (PoS) consensus mechanism or other similar mechanisms. Those who stake their coins receive rewards in the form of additional coins based on the amount they have deposited.
Why Staking is Important?
Staking plays a vital role in maintaining the security and efficiency of blockchain networks. In a Proof-of-Stake (PoS) system, those who stake participate in transaction validation and help prevent network attacks. When coin holders stake, they demonstrate their full support for the network, and it also contributes to creating liquidity for that particular coin.
What is KUB PoS Staking?
KUB's Proof-of-Stake (PoS) consensus system is a public consensus system that allows anyone to participate as part of the KUB by staking KUB coins. This grants them the right to become a transaction validator (Validator) or participate as a delegator (Delegator). Delegators stake KUB coins to increase the chances of validators being selected to validate transactions on the KUB.
The Proof-of-Stake (PoS) consensus system offers various benefits, such as reducing electricity consumption, scalability of transactions, faster transaction speeds, and security measures for network integrity. This helps nodes function correctly and makes the blockchain network more secure and decentralized.
What is Validator and Delegator
Validators, or transaction validators, are responsible for verifying and confirming transactions on the blockchain to enhance transaction security and decentralize the blockchain.
On the KUB network, individuals who act as validators must stake KUB coins to gain validator rights. The rights acquired to be a validator and the right to receive transaction rewards (Reward) depend on the number of KUB coins staked by each validator.
A Delegator in KUB's Proof-of-Stake (PoS) consensus system is someone who delegates transaction validation rights to a validator (Validator). Delegators must stake KUB coins with a validator (Validator) to participate in transaction validation on the block and receive rewards (Reward) proportionally to the number of coins staked. Delegators do not need technical knowledge or to set up node infrastructure.
Validator Benefits
Validation of transactions via the block and the consensus mechanism
Earn higher rewards based on the staking amount
Have ownership of nodes and control over the operation of the Node
Directly contribute to safeguard security and stability of KUB network
Validator Remarks
Required technical knowledge and infrastructure setup of the Node
Responsible for maintaining the availability of Node
Delegator Benefits
Participate indirectly by joining with Validators
Receive rewards from validation of transaction proportionally, of which such reward shall be shared between the Validator and the Delegator
No need to setting up or maintaining infrastructure or having technical expertise relating to the Node
Delegator Remarks
Rely on Validators' performance
May encounter the situation that some Validators may not obtain much chance to validate blocks and obtain reward.
Flexibility to stake with different Validators
How to Stake KUB coin
How to Delegate
Go to staking.bitkubchain.com
Connect Bitkub NEXT or Metamask
Note: You cannot delegate to an Official Node if you are using a Metamask wallet.
Choose Validator that you would like to Delegate
Specify the number of KUB coins you want to delegate and confirm the terms of service.
Your Delegation is completed
Learn about setting up Pool Nodes and Solo Nodes at:
https://docs.bitkubchain.org/bitkub-chain-pos/validator-node/validator-staking
Start Staking or Becoming Validator or Delegator
Staking is an attractive way to generate additional returns from holding digital assets. It also plays a crucial role in supporting and securing blockchain networks. However, interested individuals should research and understand the associated risks before starting to stake in order to make informed and safe decisions.
Staking KUB on the Proof-of-Stake consensus system on KUB is another way for you to learn about the system and gain a deeper understanding of blockchain. You can learn more interesting things on the KUB website or sign up for a free Bitkub NEXT account now.