Crypto staking is one of the consensus called Proof of Stake.
It is a way to reward workers from consensus to contribute power to support the ecosystem.
However, the SEC just fined Crypto exchange Kraken of their staking services.
Why SEC did it?
There is a misconception about yield and staking in the crypto exchange.
Because there is no way users know how the crypto exchange operates, those services can have a mix of yield and staking together but only give a rewarding result.
Yield is a crypto lending that bankrupts many crypto companies, including FTX. They are highly leveraged of what they did not have to attract investments from everywhere and hope to return their investors with rewards so they can keep the money.
Staking is what blockchain operation requires and a way to reward blockchain workers through their contribution.
Similarly, staking is also hoping users keep their money in the pool as long as possible.
But staking has not leveraged assets to possibly make the investment disappear.
Such investment lost usually occur from yield products due to their highly risky bet and highly returns of investment they promised at the first place.
And yield product is not hedge funds either because their investment portfolios are mixed with many god-known "promise" investments.
That is why yield is no no but staking is okay.
Photo by Afif Ramdhasuma on Unsplash
Note: the post was shared on multiple platforms here.
Don’t forget to check out my new book here
You can refer my previous article lists here and here and here and here
Things that do not work out in crypto after 14 years of its creation
Crypto has a lying problem
Crypto bro problem
Crypto whales are exiting
History repeats itself
Banks stay away from crypto for now
Disputes between DCG and Gemini
New NFTs Trend
SEC Lawsuits
Why play to earn is a slavery game
Why AI is more convincing than blockchain
Bitcoin bond is nonsense
Bull market returns until
Bitcoin got one more problem
Deflation is coming
The thesis against Crypto Exchanges
Crypto liquidities
Crypto bear market isn't gone
Does Bitcoin negatively correlate to the dollar
Why Ethereum reputation is in question
Crypto whales are secretly dumping
Bitcoin is not efficient
Why Ethereum killers are killing themselves
One more thing NFT can do
Mother of all bubble
Crypto is a good investment or not
Say no to FOMO
About my new book
Market is up today but why
What is up with market today
When the safest security got hacked
Why the government tried to regulate crypto but fail
Era of influence
Serious of crypto
Humanity in crypto
Position of Crypto
The only way
