What is Proof-of-Stake (PoS)?
As Investopedia defines, “Proof of Stake (PoS) concept states that a person can mine or validate block transactions according to how many coins he or she holds. This means that the more Bitcoin or altcoin owned by a miner, the more mining power he or she has”(Investopedia).
- Rewards rely on how much “stake” a miner has, or how many coins they hold in a wallet.
- PoS was invented as an alternative to Proof-of-Work
- PoS requires much less energy opposed to Proof-of-Work
- PoS has proven to be less prone to network attacks than Proof-of-Work.
How to Earn Passive Income with PoS Cryptocurrencies:
There are a few different ways to jump into staking, today I’m gonna explain a couple that I personally have had success with. From beginner to crypto expert, anyone can start earning easy passive income with proof of stake.
Method #1: The Traditional way
Find your desired proof of stake coin, head over to their website and download the staking qt wallet. Wait for the wallet to sync and download the entire blockchain. Make sure to encrypt your wallet after that then, take note of your receiving (deposit) address. Head over to your prefered exchange, buy the coins you picked. Send them to your wallet, make sure your wallet is on and running. Unlock your wallet for staking and wait for your coins to mature and your staking weight will begin to increase. Wah-lah, as long as your wallet is running and connected to the blockchain you’re officially staking congratulations!
Method #2: My preferred option
Researching, downloading, syncing and buying coins, waiting for them to transfer mature, etc… is a long process. I’ve found a new way to jump right into the rewards of PoS with tons of added benefits that make this method my number one way to earn passive income with PoS coins.
Here we go, so what’s the catch?
Instead of all the work that goes into setting up your own wallet, there's an alternative called PoS pools. What are PoS Pools? “A stake pool is a reliable server node that focuses on maintenance and holds the combined stake of various stakeholders in a single entity. Stake pools are responsible for processing transactions and producing new blocks” (Cardano).
Stake pools do all the work and send the rewards to you automatically. Additionally the additional weight of all the other coins in the pool will exponentially increase your earning potential whereas the weight of other’s is added to yours. This means, if you have 100 coins staking in a wallet of your own, and 100 in a staking pool. Your stake rewards will be significantly higher on the stake pool than on your own.
What are some Reputable Stake Pools?
The one and only Stake Pool I use and recommend is StakeCube. They have a decent track record and have a page dedicated to displaying their reserve funds. So you know exactly what the pool is worth at all times.
One of my favorite features of their website is their faucets. Every 24hr you can claim 15+ different coins, which begin staking as soon as you claim! On top of that I like to used some third party faucets on the side to top of my staking sats. If you’re interested in a few I use check out my other article here.
Next, they have an excellent referral program and incentives for shared masternodes alongside the staking pool. They have an excellent community in discord and highly active on top of that.
I’ve tested other stake pools, but none offer the features StakeCube does. It’s a truly amazing platform and I’m so excited to share it with you guys.
Registration Link: https://stakecube.net/?team=ep1c