What is Staking as a Service?
Staking cryptocurrencies has grown in popularity as a way for crypto investors to earn interest income on their holdings of digital assets. According to Lielacher (2021), staking is a term used in the cryptocurrency field to describe the process of locking up a digital asset by “staking” it to safeguard a blockchain network. Participants that stake their coins earn a piece of the block reward in the form of newly minted coins in exchange for assisting with network security. As stated by Coolbitx, staking pertains to the lending of cryptocurrencies as collateral via proof-of-stake (PoS) blockchains for a variety of purposes, including extending loans, confirming network transactions, earning interest, or gaining new crypto tokens as a reward (yield farming).
Proof of Stake (PoS) is the latest wave of innovation that many of today’s most prominent blockchain projects have embraced. However, for the majority of blockchain enthusiasts, taking is not a “set it and forget it” operation. For many, the barrier to entry into staking is high as it includes monitoring staking performance, selecting which validator to support on the network, and in certain circumstances, having their return on investment affected by slashing. To address these issues, Staking as a Service (SaaS) comes into play, which immediately became popular as a dependable and consistent method of staking funds.
In its simplest form, Staking as a Service (SaaS) refers to allowing holders of a proof-of-stake cryptocurrency to participate in consensus via a trusted staking provider, such as an exchange or financial institution. These entities provide this service to maximize returns for their customers, in exchange for a charge. This tool enables holders of Proof-of-Stake (PoS) crypto assets to engage in staking without requiring any special knowledge or skills.
SaaS represents a significant advancement in the process of adding value to clients’ holdings. Through staking, stakeholders can actively contribute to the decentralization and security of networks. Blockdaemon (2021) outlines some of the advantages that SaaS provides to both individual investors and businesses, including potentially lucrative return on investment, user-friendliness, and keeping up with network inflation.
There are many Staking-as-a-Service platforms where investors can stake their stackable PoS digital assets via a third-party service that manages the technical aspects of the staking process. Notable digital asset exchanges that offer exchange staking consist of Binance, Coinbase, KuCoin, Kraken, and Poloniex.
As another prominent decentralized exchange that provides users with a suite of services to help them maximize their returns in the DeFi space, Coinswap has a staking service (CSS Stake) where users are allowed to easily stake their CSS tokens that can be rewarded as well with CSS.
To stake CSS tokens, you may visit, https://coinswap.space/.