As Krüger points out, staking has been incredibly popular for those exchanges which have incorporated it. Binance has been supporting staking for many cryptocurrencies like NEO and VeChain for some time now. Coinbase, on the other hand, has recently started to roll out these benefits. However, the real allure of staking lies in its promise of “passive income.” Similar to how mining produces block rewards, staking allows for transactions to be validated while incentivizing users with a piece of the block emission rewards. The end result is more value on-chain and more people in the network having ‘skin in the game.’ As Cornell Professor Emin Gün Sirer put it, PoS “keeps value within the system.” Krüger argues that this idea will especially catch on given the increasing interest in ‘passive income’ across the board. Google searches for ‘passive income’ have consistently been ticking upwards for years.
2020 could be the year of staking, driven by Ethereum 2.0.— Alex Krüger (@krugermacro) November 30, 2019
Market is likely overlooking its impact, because the upgrade is rather complex.
Take Tezos for example, $XTZ is +44% vs USD and +73% vs BTC since Coinbase introduced staking this month.https://t.co/DKSr438iZE
This isn’t to say that PoS cryptocurrencies are the end-all. Many of them are scams, though there are other promising next-generation 2019 projects which will soon introduce staking like Matic (MATIC), Harmony (ONE), and Elrond (ERD). With many projects planning on rolling out this feature in 2020, we could quickly see a tidal wave of interest. Ethereum is leading the push towards proof-of-stake cryptocurrencies, but the ecosystem is quickly expanding. Just like Bitcoin wasn’t the only proof-of-work cryptocurrency in town, Ethereum won’t be the sole proof-of-stake cryptocurrency. With such a growing interest in passive income, we shouldn’t be surprised if 2020 is the year of staking.
Passive Income is not a "meme".— Alex Krüger (@krugermacro) November 30, 2019
This is how interest in passive income looks like. Do you see the trend? pic.twitter.com/AGtJmhGVAO
Images are courtesy of Twitter, Shutterstock.
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