As the darling of the blockchain industry in 2019, the staking economy once set off an industry boom. This boom has continued into this year and has formed a normalization in the industry.
The most common form of participation in staking products is for community users to stake the tokens they hold, so as to obtain rewards. Through this basic form, many different types of staking have also been derived, such as holding for interest, pledge mining, lock-up mining, etc.
Mentioning staking can't help but think of the POS mechanism, in fact the latter is the development basis of the former. The public chain adopting the POS consensus mechanism needs to mortgage a large number of tokens to ensure the security and activity of the main network. For this reason, the project sponsor will do everything possible to encourage more users to participate, and it has also unexpectedly spawned the development of the staking economy.
The staking economy is not only a single mortgage interest generation model, but also changes the business logic and supply-demand relationship of the industry. For users, holding tokens can have more rights and obligations; for project institution, having more business opportunities; and for the token itself, it also gives greater value and applicability.
The bear market of the blockchain has also helped the development of staking. Earning money in a bear market and a bull market is the most basic consensus, but for most users, they often cannot withstand the temptation of short-term games, and participate in frequent transactions and eventually lead to losses. The staking form can provide an excellent solution for these users, mortgage the token in it, and enjoy the benefits brought by the coin standard while waiting for the bull market.