AVALANCHE IS THE FIRST NEXT-GENERATION BLOCKCHAIN USING PROOF OF STAKE TO DELIVER AT THE SCALE DEFI DEMANDS
WHAT IS STAKING?
Staking is the process of maintaining funds in a cryptocurrency portfolio to support the operations of the Blockchain network. Essentially, it consists of maintaining cryptocurrencies to receive rewards. In most cases, the process also involves user participation in Blockchain activities through a personal cryptocurrency wallet.
The concept of staking is strongly related to the Proof of Stake mechanism. It is used in many Blockchains based on the PoS engine or in one of its variants.
HOW DOES STAKING WORK?
As mentioned, staking is the process of holding funds to receive rewards, while contributing to the operations of a Blockchain. Therefore, staking is widely used in networks that adopt the Proof of Stake consensus mechanism or one of its variants.
Unlike Blockchains Proof of Work that rely on mining to verify and validate new blocks, Proof of Stake chains produce and validate new blocks through staking. This allows blocks to be produced without relying on mining hardware (ASICs). Therefore, instead of competing for the next block using a lot of computational power, the validators of a Proof of Stake system are selected based on the number of currencies they are committing to staking.
Typically, users who stake with larger amounts of coins have a greater chance of being chosen as the next block validator. While mining ASICs requires significant investment in hardware, staking requires a direct investment (and commitment) from cryptocurrencies. Each Proof of Stake Blockchain has its specific staking currency.
The production of blocks through staking allows a greater degree of scalability.
With more and more options for users to participate financially in the consensus and management of Blockchains, the increase in staking activities is likely to reduce barriers to entry into the cryptocurrency ecosystem.
HOW DOES THE PROOF-OF-STAKE IN AVALANCHE WORK?
Avalanche is a consensus mechanism, and therefore could be used with a variety of sybil control mechanisms like Proof of Stake or proof of work to reach a distributed consensus around a Blockchain or cryptocurrency system.
Avalanche uses Proof of Stake, which allows tens of thousands of validators to have a first-hand say in the system while consuming minimal energy.
A Subnet, or Subnetwork, is a dynamic set of validators working together to achieve consensus on the state of a set of Blockchains. Each Blockchain is validated by exactly one Subnet. A Subnet can validate arbitrarily many Blockchains. A node may be a member of arbitrarily many Subnets.
A Subnet manages its own membership and it may require that its constituent validators have certain properties. This is very useful and we explore its ramifications in more depth below.
There is a special Subnet called the Default Subnet, which validates Avalanche’s built-in Blockchains. All members of all Subnets must also be a member of the Default Subnet. In order to become a member of the Default Subnet, one must stake some AVAX tokens. The upshot of the preceding two points is that all validators of all Blockchains must also validate Avalanche’s built-in Blockchains and must have staked AVAX tokens.
AVAX is the capped supply native token of the Avalanche platform. Participants can become full block-producers and validators by staking AVAX tokens and are incentivized to do so because of staking rewards.
The participation in the network is contingent on staking. Nodes are operated by anyone really, as long as you run the code.
Avalanche sets itself apart from other Blockchains due to its lightweight, simple, and intuitive staking process. To stake you simply send a special transaction to the network that locks a minimal amount of AVAX tokens. If that threshold is met, you automatically become a staker. Becoming a full block-producer in Avalanche and all of its other Subnets requires a minimum of only 2,000 AVAX tokens. Supported environments include Windows, Mac, Linux, and most cloud infrastructures. During your staking period, those funds are locked.
A crucial differentiator between Avalanche and other Blockchain platforms is its governance mechanism. Staking rewards are subject to dynamic changes as the system evolves. For the first year, the annual staking reward will initially target a minting rate between 7% and 12%.
Soon we will be able to start the staking as soon as the Avalanche mainnet is launched.
Learn more at https://www.avalabs.org
“Esse artigo é meramente informativo e não é uma recomendação de investimento, o mercado de criptomoedas é bastante volátil e você deve pesquisar e decidir por si mesmo em que investir, especialmente em mercados de alto risco”.