Staking with Bithumb Global 101
Cryptocurrencies are asset classes that offer investors a wide variety of choices to earn a steady income, while helping create long term wealth. Like stocks, cryptocurrencies can be traded to make profits. But, unlike stocks or other traditional instruments of investments, their digital and decentralized nature helps remove many hurdles and makes transactions easy and seamless. Crypto trading has taken the fancy of millions of traders as the risk: reward ratio is pretty high.
Crypto Volatility Makes Trading Risky
Cryptocurrencies are very volatile and thus are susceptible to high degrees of market risks. Being unregulated, it is often also difficult to figure out tokens that are reliable and will not expose the investors to additional risks of market manipulation. All this makes trading a very difficult process.
Not only does it involve a lot of previous knowledge and sophisticated expertise to make big bucks out of trading in cryptocurrencies, it also requires people to be more active participants. This is to say, it also requires significant time investment on the part of the traders to navigate their way through the different risks that their portfolio might be exposed to.
Nevertheless, with the growing user base of cryptocurrencies and crypto exchanges, decentralized financial organizations are moving towards more sophisticated forms of investments which helps users not only gain higher profits but also reduce their risk exposure. In fact, in the process of becoming more economical, the crypto industry has shifted from a Proof of Work model involving mining of tokens to a Proof of Stake model where the highest staker will be allowed to create the next block.
This model has created the prospect of generating a passive income, similar to a savings account in a bank, but with a much higher interest rate. This process, popularly referred to as DeFi (decentralized finance) is enabled by different leading exchanges like Bithumb Global. A report in the Bloomberg early in the year 2019, stated how this safe mode of investment is becoming popular, especially in the light of the months of volatility faced by the crypto sector leading up to 2019.
For the purpose of staking, the exchanges similar to bank saving accounts require the users to simply hold their crypto assets in their account on the respective platforms, i.e. in their wallets. This allows the companies to stake it on the particular blockchain of the token and the user gets rewarded for supporting the network by holding the tokens. The rewards are in proportion to the token holding of the user.
Advantages of Staking
Staking has several advantages, the first being the reduction in risks to individual customers. Being a pool of stakers, the returns are leveraged and the risks are shared making it a stable source of passive income for new investors and those who do not want to invest a significant amount of time in trading.
Staking compares much better to savings accounts of banks because of higher returns from various sources. Not only does staking lead to appreciation in the asset holding of the users, but it also allows users to benefit from the increase in the price of the tokens that they are holding. And the combined returns on both of these can be significantly higher than the savings accounts in the long run.
Moreover, being enabled by a major exchange platform, staking gives the users access to some of the best crypto projects. This protects the users from any potentially sketchy projects which are either engaging in financial malpractices or are hoax altogether. Therefore, the outcome is that there is largely greater stability for the users and greater safety for their assets.
Finally, the staking process is much easier compared to any fiat-based banking process like making a savings account or investing in a fixed deposit. Once you have an account, you are just a few clicks away from earning your periodic rewards.
Staking the Bithumb Way
The Bithumb Global platform is part of the Bithumb family. While Bithumb started its journey in Korea, it has expanded its digital footprint across the globe to become one of the most trusted exchanges in the world. With its existing hold on the market, the staking service provided by the exchange is one of its kind.
The exchange brings to its users a wide array of tokens for staking. All these are top-notch crypto projects with great records from the past. The platform is a way of connecting great projects with prospective investors on the platform. Many of these projects have a high annual return potential and therefore they are very lucrative offers that are brought exclusively to the users of Bithumb Global.
Moreover, another key advantage of investing or staking on the Bithumb Global platform is the flexibility that comes with it. The platform allows staking particular forms of currency for shorter lock-in times making it ideal for many investors who are looking to try out different tokens and the returns from them. After all, the short term gains can be significant.
Therefore, for new investors looking to invest in great projects like Mantra DAO, 2Key network, and Gather to name a few, in a flexible manner with significant safety nets against market failures, Bithumb Global’s staking services seems to be a great option.