For individuals who are into cryptocurrency, staking is not something new. As an investor or cryptocurrency holder, it is important to know what staking is and how it works. To start staking, it’s important to know what a staking node is and how it can benefit you.
Bitbuy looks at what a staking node is, the benefits of running a staking node, and how you can set up your own staking node. We will also look at how Bitbuy is making it easy for Canadians to take advantage of staking nodes.
Simply put, a blockchain node is a computer that is connected to a blockchain network. A node acts as a gateway that allows a user to transact on the network and view the blockchain's data. They are decentralized networks where each node works together to validate transactions and reach a consensus.
A staking node is a system that allows someone to participate in staking on a Proof-of-Stake cryptocurrency network, while also maintaining the blockchain, a term referred to as delegating your stake. Essentially, you can stake your cryptocurrency through a node. It connects blocks of transactions and validates them while earning rewards for doing so. In other words, these nodes are designed to provide a way for people to contribute to the network and earn rewards while maintaining its integrity.
Traditional staking is a simpler investment strategy that involves buying and holding coins in a specific wallet and earning rewards based on the staked number of coins. It attracts more users as it does not require special equipment or technical expertise. Nodes differ from traditional staking in that they are typically hosted on a server or computer that is specifically configured for the task. Traditional staking allows the stakers' earnings to depend on different factors, including the coin's market value and the staking period. In contrast, node staking requires advanced technical knowledge and hardware, making it less accessible to investors looking for a hands-off investment. Moreover, node holders enable more customization of staking plans, as they can vote on governance proposals.
Running a staking node offers many benefits. One of the main advantages of staking nodes is that they allow for greater network security. Nodes are incentivized to detect and report any fraudulent activity or security vulnerabilities, so they are actively helping the network prevent a security breach.
Running a staking node is also an efficient way to use your computer resources. It earns rewards for validating transactions on the blockchain, while also maintaining the network. If you hold a significant stake in a particular cryptocurrency, staking nodes will enable you to secure your investment by assisting in the process of validating transactions.
Different staking nodes support different tokens and networks, so it's essential to know which one is suitable for you. Choose a node that is compatible with the token you want to stake to ensure the best outcome. Check if the node offers a specific token that you are interested in, and take note of the fees and rewards for staking it in the node.
Uptime is another critical consideration when choosing a staking node. If the node goes down, you lose your staking rewards, reducing your return on investment (ROI). As a result, it's crucial to choose a node with reliable uptime that minimizes the chances of missing rewards.
Bitbuy, one of Canada’s leading cryptocurrency exchanges, has made it easy for Canadians to earn staking rewards staking across multiple tokens. Our platform provides the ability to participate in staking without having to set up and run staking nodes individually.
The first step to start staking with Bitbuy is to select the token that you want to earn rewards on. Bitbuy currently offers the largest selection of stakeable coins of any regulator approved platform in Canada , including Ethereum (ETH), Polygon (MATIC), Solana (SOL), Cardano (ADA), and Polkadot (DOT). Choose the token that you want to stake based on which token you would like to hold, the potential for rewards, and your overall investment strategy.
Once you've decided on your staking token, if you already hold the token then you'll need to transfer your crypto funds to your Bitbuy wallet. If you don’t hold the token, then you can fund your Bitbuy account (link) with Canadian dollars via Interac eTransfer or bank wire and buy the token and amount that you want to stake on the platform. Once your crypto funds are in your account, you'll be ready to begin the staking process.
The next step is to start staking. It’s easy, simply clicking on the Staking tab on desktop or mobile app and choose the asset you would like to stake along with the amount. You will start earning rewards after the bonding period of your chosen asset and your rewards will be automatically restaked to benefit from compounding.
That’s all, you are now staking and earning rewards effortlessly on Bitbuy! Stay on top of your rewards earned with the Lifetime Rewards dashboard and keep them staked to continue growing your earnings.
Staking nodes are a great way to earn rewards while contributing to the network's security and maintaining the blockchain. Running a staking node may seem daunting and does take extensive knowledge to get started and maintain it properly. However, Bitbuy is making it easier for Canadians to participate in staking without having to go through the hassle of setting up their own nodes. Additionally, if you are an institution or a high net worth individual looking to stake $20,000 or more, our team can help you through the process with Institutional Staking by Bitbuy Private Wealth.