On 26th September, Binance officially launched the most promising coin staking platform yet in an event that went largely unnoticed by the crypto industry. Dubbed ‘Binance Coins Staking Platform,’ this PoS seeks to introduce an automated and competitive reward system for Binance customers using the Binance exchange wallet to store their digital assets. But how does it work and how different is it from the rest of the proof or stake platforms initiated by other crypto exchanges?
About Binance Staking
Making the announcement on Twitter, Binance CEO – CZ – argued that this staking platform will enable users to earn rewards by just depositing and holding assets in their Binance wallets.
Theirs is the most simplistic rewards system yet, where users won’t have to worry about the staking time length, minimum staking amounts or other technical requirements like node creation. You don’t have to do anything, your money plays the game for you.
Additionally, Binance updated its staking calculation methodology on October 1st for all staking distributions. This step will further increase the reliability and accuracy of reward distribution for the different staked coins.
How does staking it work?
Unlike early blockchains like Bitcoin use the Prove-of Work (PoW) systems to validate new chain’s blocks, Binance uses the Proof-of-Stake (PoS) mechanism. This implies that instead of relying on mining hardware to validate new blocks, Binance relies on PoS validators who commit a number of coins to the platform. This is relatively cheaper and faster plus the production of blocks through staking is believed to ensure a higher degree of the blockchain’s scalability.
Depending on your stake size, the PoS system can yield considerable returns. Here, investors will earn interest from these returns as long as they have coins held and staked on their Binance wallet.
What coins are listed for rewards?
As expected, BNB tops the list of coins that you can hold or stake to earn rewards. Others include:
- Hold NEO to make GAS
- Hold ONT to win ONG
- Stake ALGO on Binance
- Stake STRAT on Binance
- Stake XLM on Binance
- Stake KMD on Binance
- Stake QTUM on Binance
- Hold VET to earn VTHO
Why is Binance Staking Platform Different from the rest?
No Lock-Up Period- Unlike in most other exchanges, Binance won’t require you to lock up your digital assets for a particular period. You will have unrestricted access to your coins.
Its free- There is no catch around this. It is free for anyone with funds in their Binance wallet.
Use portions of your stake- You are free to trade a portion of the staked coins and still get to earn rewards for the remaining portion.
Coin staking Platforms are gaining popularity as crypto giants seek to outdo each other. Coinbase Pro, for instance, launched their PoS staking platform in March that supports Tezos (XTZ) coins. Unlike Binance’s free and open PoS platform, Coinbase will only accept stakes from institutional investors, not to mention that it’s not free.
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