Chainlink (LINK) Staking - Is It Worth It?

By Bfab | Good vibes | 10 Dec 2022

Chainlink pays out around 5% in annualized rewards to stakers in the form of LINK tokens.

What kind of staking is it?

LINK is an ERC-20 tokens, i.e., not a coin with its own blockchain like Ethereum (ETH).

Therefore, the so-called "staking" consists in locking LINK tokens into a liquidity pool.

Concretely, stakers commit LINK tokens in smart contracts to back some performance guarantees around their oracle services. Therefore, this staking includes smart contract risks and hence is not as secure as staking of Proof-of-Stake coins like Polygon (MATIC).

Furthermore, the staking is initially limited to node operators who qualified for early access around 2021 by meeting a few requirements.

Is it worth it?

Most of LINK holders recently discovered these requirements on Chainlink blog and understood they will have to wait a while to become eligible, what urged them to sell. Therefore, in the short term, LINK ist bearish. In the longer term, the staking rewards will be paid out to stakers by increasing LINK token circulating supply, and the resulting inflation could have a negative impact on LINK price.

Disclaimer: this article does not contain any financial advice. The information is provided for general informational and educational purposes only.

Please find below a few more links to earn a few more coins...

Resources