What is Staking? Taking a closer look at how staking works with PhoenixDAO
Most people think about using a centralised exchange to buy crypto when they’re ready to invest in crypto. Some who have technical expertise might even consider crypto mining as a way to dip their toes in the crypto world and earn coins.
However, crypto staking remains one of the easiest ways to acquire cryptocurrency and keep earning passive income on current holdings.
What is Staking in Crypto? Staking is where digital assets are locked up to obtain additional rewards or (often lucrative) interest on the investment. Essentially, stakers help approve and verify transactions on a blockchain. Locking up holdings helps a network perform various processes, like forging new blocks.
Many different cryptocurrencies can be staked to earn rewards. Staking is particularly popular in the decentralized finance (DeFi) world, as the lack of intermediaries leads to exponentially more profits and greater user control over funds, compared to other options.
PhoenixDAO’s staking dApp (V2) allows users to earn up to 200% APY by adding liquidity to Uniswap PHNX:ETH liquidity pool and then staking their LP tokens, alternatively users can lock their native PHNX token to take advantage of the V1.0 spot staking feature based on individual preference.
In particular, the spot staking functionality will be utilized through a wide range of planned PhoenixDAO products.
PhoenixDAO stakers have access to a wide range of platform tools to maximize potential investment opportunities. An intuitive dashboard makes it simple to view active and historical staking at a glance. Stakers can choose to connect their MetaMask wallet or eventually a Numio Wallet as one of the benefits of a strategic partnership between PhoenixDAO and Numio.
PHNX rewards immediately are paid into a user’s connected wallet as soon as terms of the staking agreement and the overall transaction has been agreed to and processed. In contrast to other staking platforms PhoenixDAO utilises this feature to encourage DAO participation and so if users look to take an early withdrawal a percentage of their PHNX are burnt.
PhoenixDAO allows users to directly add liquidity to a Uniswap liquidity pool to earn Uni LP tokens. The Uni LP token holders can then stake their tokens to earn additional PHNX tokens creating an even more rewarding liquidity protocol.
Yields across liquidity pools can prove to be quite lucrative. Smaller pools and newer projects often offer higher percentage yields to attract more users to stake. For example, BondAppetit offered yields between 480-790% in May as an incentive for crypto fans to stake the BAG token and the USDap stablecoin.
Users who stake PHNX can vote on proposals and potentially watch suggestions and ideas for platform improvement ‘win’ and become enacted. Users maintain the option to stake on multiple proposals but are only able to stake one time on each proposal.
Overall PhoenixDAO stakers have an immense opportunity to positively contribute to the wider ecosystem, earn passive income on staked coins, and participate in the platform’s governance process.
Those ready to stake and enjoy the benefits of gaining interest by locking up PHNX can head to the PhoenixDAO website to connect their wallet and get started!
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