The Proof of Stake model is rapidly gaining popularity in blockchains because it provides the benefits of faster block validation and greater decentralization.
Not surprisingly, major exchanges, custodians, wallets, and treasury managers are expanding their staking options to make the most of the trend. Moreover, they are opting for staking-as-a-service from platforms that provide a secure environment to stake in just a few clicks.
Additionally, understanding the implications of Crypto Tax Australia can help investors maximize their staking rewards.
The service also eliminates the need to set up node infrastructure for receiving returns. The benefits of crypto staking services are more than what appears on the surface. Here are some reasons to consider staking-as-a-service.
1. Lucrative return on investment
Staking service providers like Bybit Staking enable holders of PoS coins to get lucrative financial opportunities. Holders are stakeholders in the network, so they are rewarded for participating in consensus.
They can participate in block production or delegate this right to a validator. These validators can produce the next block in the chain. Running a validator requires a minimum stake, technical knowledge, and equipment.
Not living up to these requirements of staking can lead to hefty penalties. However, a reliable staking platform eliminates these tech barriers and simplifies the process for clients.
2. User-friendliness
PoS networks are open, so virtually anyone can become a validator or delegator. But staking is not as simple as it sounds because newcomers may encounter several obstacles.
Staking-as-a-service platforms like Kiln simplify the process because of their user-friendliness. SaaS manages the process on behalf of its users, so they need not stress even as beginners.
The best part is that getting started is as easy as a few clicks. Moreover, the rewards go directly to the user’s wallet, which means they are secure throughout the process.
3. Inflation-proofing
Blockchain is prone to inflation as the number of assets may become diluted compared to the increasing supply of the said cryptocurrency. Over time, the overall holdings become smaller with respect to the assets circulating in the system.
The SaaS model can help crypto exchanges and custodians offset the inflationary effects for the holders, regardless of the increase in the circulating supply.
User holdings increase with the overall inflation, ensuring the safety of their assets in the long run. In this way, SaaS providers safeguard customers’ funds from leaking value due to ongoing inflation.
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4. Secure and easy-to-use interface
Staking-as-a-service providers offer immense benefits to financial institutions of all sizes and types. They provide a secure and easy-to-use interface to ease the staking journeys and ensure the best services to customers.
Institutions can rely on a platform to ensure hands-off management and a level of quality that many users desire.
However, it is vital to choose a reliable platform that offers a variety of cryptocurrencies for broader coverage and better services to clients.
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5. Less resource-intensive
The Proof of Stake model is far less resource-intensive than the traditional system.
However, it works only if crypto holders are ready to lock up their currencies to increase network security and validate transactions.
The incentive of passive income is enough to make the model an enticing one for users.
