It is recommended to look at it first to have a global view.What kind of opportunities will the awakened PoS consensus bring to the Staking economy?It is recommended to look at it first to have a global view.
As Ethereum turns to PoS consensus in the future, and more and more PoS public chain mainnets are launched, PoS contains huge potential business opportunities. In addition to institutional investors and exchanges, mining pools, and wallet developers, individual cryptocurrency investors should understand the impact of the PoS economy on them as soon as possible, as well as the investment targets.
What is the PoS economy?
As more and more popular projects adopt PoS as a consensus, token holders have the right to obtain rewards through staking. Generally speaking, the annualized rate of return is between 7% and 150%, depending on different currencies. We can collectively refer to them as staking rewards.
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What are nodes?
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How does the node work?
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What is node delegation service?
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Immediate impact on the future of the PoS economy
1. If the holder does not delegate to the node, there will be no profit
2. Token holders will see various staking rewards packaged as fixed-income products or financial commodities
3. The currency of PoS will be a hot sector in 2019 and 2020
Based on our past experience in node delegation services and our industry observations, we can show you what general investors should pay attention to in the PoS economy. How to do to have a safe and stable income?
1. Don't pay too much attention to high fixed income, and drop the price of currency
The currency of the PoS consensus has income because of the additional issuance of the project itself. The higher the issuance rate, the higher the income of the currency holders, and the lower the issuance rate, the lower the income of the currency holders. But there is a price for additional issuance. Additional issuance is like inflation in the real economy. When a project party keeps printing money, the number of coins of the holders will actually decrease relative to the total number of coins, which may cause depreciation, that is, the price of the currency will fall. . No one wants to earn 50% of their fixed income, but the currency price has fallen by 80%.
We observe that most of the project issuance models have a high initial issuance rate, and as the project develops, the issuance rate gradually decreases. This is also in line with our real economy. Emerging countries usually have higher inflation and interest rates, and this rate will fall as the economy becomes more stable and prosperous. A reasonable increase rate is 0%-10%, of course, high-quality projects may also be as high as 20% in the initial stage. Once the rate of return exceeds 20%, you, as an ordinary investor, should be vigilant. Why can this project have such a high increase rate?
2. Carefully select the team that provides commissioned services
The teams that provide Staking reward entrustment services are very related to the rewards of general investors. The following are a few judgment criteria that ordinary people can refer to
- Handling fee
Generally speaking, the team will charge a handling fee ranging from 5% to 25% to the client. Generally, investors should compare different entrusting services and choose one with a moderate handling fee.
- rate of return
The rate of return mainly depends on the online time (uptime) of the team's running nodes, and whether the team has operational errors or malicious behaviors are punished by the system (slash). When a node is penalized by the system, not only will the user’s rewards decrease, but the original staking tokens may also be lost. The penalty (slash) varies according to different PoS blockchains. You don't have to worry too much, as long as most teams maintain it carefully, the income gap will not be too big.
At present, the economy brought by PoS is still in the early stage, and various monitoring tools have not yet been perfected. I believe that in the future, there will be a report on the rate of return of each node on the blockchain, just like the report on the rate of return of the fund, so that ordinary investors can have a judgment standard.
- team reputation
The higher the reputation of the team, the higher the cost of doing evil
- The contribution value of the team to the community
Choosing a commissioned service is not just as simple as gaining benefits. It is like electing representatives. These nodes are representatives of the blockchain. They make contributions to the chain according to their own capabilities. The more high-quality nodes, the faster the project. With the development of the currency, the future prospects of investors holding the currency will be more optimistic.
- Long-term cooperative team
Choosing a long-term cooperation and trustworthy team can make general investors have less time cost for selection. Bad teams may not send staking rewards, or change the handling fee at will. We have observed in the Tezos community that some teams charge very low fees to attract users at the beginning, but increase the fees in the final cycle. If the general client does not pay attention, they will pay more costs in the end.
3. Know how to check the earnings of each cycle
As an excellent investor, in addition to knowing what commodities you buy, you also need to know what the final investment income will be. For entrusted services like Staking, even if the individual trusts the entrusted team very much, it is recommended that ordinary investors should regularly check the status of their earnings. In addition to the reward query page, it also includes whether the rewards on the chain have arrived.
The above mentioned belong to the most direct and important category of rights and interests (beneficiary rights). Don’t forget that with the different blockchain projects of the PoS consensus, there are more different rights and interests such as voting, resource use rights, lease rights, etc. In the future, blockchain projects and communities will grow stronger and will gradually emerge.
In the wave brought by the blockchain, individuals have real ownership of their own assets. Wetez believes that as long as the currency holder has the currency, he should enjoy the rights and interests brought by the currency. If you don't pay attention to it, the third party may take it for granted.
