Q : What is staking, how it works

By KayDee | $PAW FAQ | 13 May 2022

What is staking ?

From Google :

  Crypto staking is the process of locking up crypto holdings in order to obtain rewards or earn interest. Cryptocurrencies are built with blockchain technology, in which crypto transactions are verified, and the resulting data is stored on the blockchain.  

What does that mean ?

$PAW doesn't use Smart Contract, so well skip that explanation here

In $PAW, the Staking is handled by the developpers, using some code and some configuration.

What happens is that some $PAW are sent to an external (Dev) account (STAKING ACCOUNT), so the user doesn't have access to it anymore. This allows for the Devs to ensure that all the staked $PAW will not be traded and so ensure some network stability. As a counter part the user is getting rewards, proportionnal to its staked amount.


How works staking in $PAW?

From any $PAW account (call it BASE ACCOUNT) you can open a STAKING ACCOUNT (see https://www.publish0x.com/paw-faq/how-do-i-stake-dollar-paw-xvmeeyq). Those 2 accounts will be linked at Dev level (somewhere in their DB)

When enrolling, you have the choice for 2 pools : 180 and 90 days unstaking period. Each pool will be associated with a unique STAKING ACCOUNT.

Let's say you choose the 180 days UNSTAKING pool, you get your STAKING ACCOUNT paw_1234....xwz. (if you choose 90d, you'll get another account like paw_def...456)

All the $PAW you send to your STAKING ACCOUNT will be locked untill you "UNSTAKE" it AND the unstaking period is over. So if you stake 1M $PAW on 1st January on the 180 days pool, you cabn decide on 1st February to unstake all.

That means your 1M $PAW will get back to your BASE ACCOUNT 180 days after the 1st February, so around 1st August (180 days is around 6 months)


How is it different from other networks

On other networks, you usually stake for a given period of time. It means that your tokens are locked for that period (say 6 months) and then you get it back diretly with the rewards included

On $PAW, you get daily rewards while your tokens are staked, and when you want, you can unstake. As soon you unstake, it stops producing rewards and your $PAW will be given back to your BASE ACCOUNT after the unstaking period


What if I need my $PAW back

Well, that's part of the downside of staking : you cannot get it back, because you "signed a contract", you agreed to lock them for a period and you'll only get it back at the end of that period

Now, $PAW has introduced a way to get back some of it in case of emergency (some other network do that too with big penalties).

You can retrieve once 20% of the staked $PAW (so if you stake 1M, you can get back 200K). That value is indicated by "Available To Withdraw" on the staking page.

Just copy/paste that and hit the "Withdraw" button to get it back on your BASE ACCOUNT.

If you enter a higher value, you'll get back a message saying "Maximum withdrawal amount of PAW is xxx"


As usual, if something is not clear, please leave a comment and I'll try to explain better


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