How to start staking NULS
One of the reasons why I’m into NULS is that they make it very easy for people to become part of the community and benefit from staking. So I thought it would be useful to take you through the steps.
Staking NULS is actually very easy, but only because they made it easy!
There are two things you have to take into account before you start:
- You have to complete the swap from ERC20 NULS tokens to MAINNET NULS coins. If you didn’t do this yet, head over to my other story (How to swap my NULS tokens?) which explains how to do the swap manually.
- You need to own a minimum of 2000 NULS to start staking.
If you tick these 2 boxes, you’re good to go!
- Start by downloading the latest version of the wallet from the official website nuls.io. There are 3 OS wallets one for Windows, Mac and Linux. The mobile versions and web wallet are due later this year.
- Next step is to fund your wallet with your NULS (minimum 2000).
- Now you need to choose which node to join. This is not just a practical issue, but also a choice you have to make. So allow me to elaborate a bit. The NULS staking mechanism works different than for example a Delegated Proof of Stake but there are similarities. In DPOS a delegate is voted for, while with NULS people (like me) who have set up a server to run a masternode need to deposit 20.000 NULS to become a masternode in the network. Such a masternode will only start getting and distributing stake rewards when it has a total amount of 200.000 NULS. In a way you could say NULS uses a voting system but set up differently. By choosing a node you give trust to that node by entrusting your coins to the total amount of the masternode. Don’t worry your coins will never leave your wallet. You just link them to the chosen masternode and it freezes that amount until you leave the masternode.
So, now that we have a bit of background you’re ready to head over to your wallet where you can find an overview of the different Agents (aka Consensus nodes, Packing nodes, Masternodes, …) on the Consensus tab.
Now, which one do I choose… ?
The green one?
Before you select a node to stake on, you have to know how they work.
There are two states for nodes:
- ‘Green’ means the node is actively participating in the network and as long as the total deposit of 500.000 isn’t reached, you’re welcome to join.
- Red means the node isn’t yet actively participating in the network but waiting to reach a minimum deposit of 200.000 from stakers, which is needed to become active.
You’re now probably thinking: “Okay! I’ll go for the green one!”, which makes sense. But you have to think for yourself what kind of role you want to play in the NULS ecosystem. Do you want to make a quick buck or do you want to support the network in the long run. For the sake of clarity: both are valid, but let me elaborate.
It’s clear what you would do if you just want to make some profits: pick the active node. Because, why would you lock your coins to a node that’s not active yet, right? One reason could be that the more nodes get active, the more secure and the less centralised the network will be - and to be honest blockchain is all about decentralisation. Another reason is that you can always hop to other nodes. As a staker, you can withdraw your coins/support at any point. So what would be a good strategy?
If you have 2000 NULS, you need to balance your desire for immediate profit with your desire to make the network more decentralised. If you choose to support a red node and it doesn’t reach the quotum, you can always withdraw.
If you have more than 2000 NULS to spare, it would be good to spread your stake over different nodes and with nodes I mean active AND inactive ones.
Why? You solve two problems by doing this:
- Nodes controlled by a couple of big stakers get more stable by adding smaller stakes to it, which in the long run will make the node less dependent of the big stakers. Because if one of those big stakers leaves the node now, the node in most of the situations will probably go down for not having the minimum staking amount anymore. Remember the minimum of 200k I was talking about before. You see it works both ways.
But with a multitude of smaller stakes on top of the big one the big stakers won’t have the power anymore to hijack a node. If one would leave now the multiple smaller stakes could keep the node going.
- Nodes which aren’t active yet will slowly become active with multiple smaller stakes which make them less prone to go down easily once they’re up and running. Also, by getting an inactive node active the network will get more secure and become even more decentralised.
In other words don’t bet on one big horse but make sure you spread your funds in active and inactive nodes. This way you make profits right away, plus you help strengthen the network.
Only by taking in account all aspects will the NULS ecosystem grow and become stronger!
4. Back to practicalities. Choose the node you want to stake on in the list of the consensus tab. Take nulsnode_com for example. ;-)
Now deposit your staking amount and that’s all. You’re set to go!
I hope this was useful to you. I hope you find reasons to join the NULS community. And I hope we will all be rewarded for doing our bit. Here’s to NULS.
PS: You can always leave a comment below if you’re not sure about anything. Or you can ask around in the Telegram group. The NULS community counts a lot of helpful people and they are always willing to help.
This story is brought to you by one of the nodes nulsnode_com. If you liked this story give me a clap and join me by staking with nulsnode_com! Happy Staking!
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