What after getting bitcoin? Now you definitely want to save it, or at best invest it. Although there are no banks that offer cryptocurrency investment pools, there are plenty of activities (with varying levels of risk) to which you can distribute your cryptocurrency. For example, you can use bitcoin to bet on online casino games and get winnings with the same currency you deposited. You can also use Strike! Ever heard of strike? That is simply holding crypto coins for an indefinite period, for which you receive interest as a reward. You can therefore compare a strike with the interest you used to receive on your savings account. It is also a way to passively earn money with crypto. What exactly is strike? How does it work? What are the pros and cons? And is it an alternative to saving? Let’s dive into the concept.
What Is Strike?
Most people invest in cryptocurrencies because they expect it to increase in value in the future. But there is another way to make money with crypto: by staking coins.
So, staking crypto is nothing more or less than buying a coin or token and then holding it. As a reward for this, you receive interest, just like you used to receive interest on your money if you left it in a saving bank account.
How much interest you receive depends on the crypto currency and the exchange. But to give you an idea: staking Cardano via Bitvavo will yield you an interest of about 5 percent per year, Tether more than 6 percent. A lot better than the 0.0 percent you get on your savings account, so.
But why do you get a reward when you hold coins? By staking crypto you support the security and operations of the blockchain network. Because investors strike, the blockchain remains up-to-date and transactions can be sent and received over the network.
How Does Strike Work?
Above you briefly read why you are rewarded for staking, but how exactly does it work?
You have probably heard of mining. Proof-of-Work cryptocurrencies such as Bitcoin require mining to verify new blocks. This process uses the computing power of computers to verify new blocks. You can see the warehouse spaces full of computers (mining farms) in front of you.
With Proof-of-Stake crypto coins, blocks are not verified on the basis of that computing power of computers, but on the basis of crypto held by investors. In short, that’s the difference between mining and staking. If you need a more technical explanation about staking, we recommend this article from Binance Academy.
Can You Strike Any Cryptocurrency?
As you probably understand by now, you can’t just stake any cryptocurrency. The coin must use the Proof-of-Stake concept. However, there are also exchanges that offer staking for other cryptocurrencies. Then you actually get interest as a reward, because you use that exchange.
Which Crypto Coins Can You Stake?
Below you will find a number of crypto coins that you can stake via Bitvavo (a user-friendly app, which in theory even allows your mother to invest and stake) and the interest you receive per year. This can change and isn’t the same with every exchange, but it’s more to give you an idea:
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