Smart people are buying cryptocurrencies now because of the fast-growing demand. Unlike about ten years ago, when cryptocurrencies were taken suspicion, almost everyone now wants to be part of this growing network. From governments to individuals, blockchain is now adorable. For example, El Salvador has recently made Bitcoin a legal tender. This is just one case. Others such as Nigeria, Netherlands, Iceland, Japan, and Denmark, among others, are also fully or partially supporting cryptos.
Apart from using cryptocurrencies for purchases from stores that accept them, trading, or giving gifts, there are two more methods that you can use: holding in your wallet or staking. One fact about these two methods is that you are not selling the coins, but how they work is completely different. So which one should you pick? Here is a comparison.
Holding Your Coins Waiting for Value to Grow
Holding your coins works like buying and holding shares or fiat currencies, and it is a good idea that has worked wonders. We will demonstrate this with an example. Take the case of a person who bought 1000 Bitcoins in 2010 when each of them was valued at less than USD1. If the person held the 1000 coins until March 2020, each of them would have grown from USD1 to USD 58,700, giving a total return on investment of about USD 58,700,000. Is that not awesome?
The main advantage of using the buy and hold strategy is that you get to enjoy the growth in value of your investments without selling the coins. However, we MUST also indicate that the risk of loss also looms. If the value of the coins falls, and many reasons can pull it down, you can also incur huge losses.
Staking Your Crypto Coins
You have seen the advantages that come with buying and holding your cryptocurrencies, but wait for a moment before making the decision to go for it! Crypto staking is even better. Indeed, we prefer to call staking an improved method of “holding the coins” because you are not selling them. So, staking comes with all the benefits you would get from buying and holding, plus a lot more. Let’s dig in.
Crypto staking is the process of committing your proof of stake (POS) coins to make a node that can help with transaction confirmation. Therefore, you are only committing the coins and not selling them. At the end of the staking period, you get back the coins plus the rewards awarded for confirming and protecting the blockchain.
The process of staking is pretty simple, and you can be done in minutes. You only need to buy the preferred coins and send them to the preferred decentralized finance (DeFi) platform for staking to commence. It is that simple. From there, you only need to sit back and watch passive income flowing into your account. If you stake the coins over a long period, it can be an excellent channel for regular income.
As you can see, buying and holding crypto coins is awesome, but staking is even better. You are simply using the available coins to create additional revenue without selling them. Indeed, you can even get more returns from your coins by staking with a trusted platform. One outstanding DeFi platform which is known for its professionalism and security of clients’ coins is Mantra Dao. The platform is easy to join, and you can buy and start staking your coins in no time. Visit them now to learn more about staking and blockchain.
Why only hold your coins when they can bring more returns through staking?
