What is STAKE on EOS
EOS guide for beginners
If you have EOS token and want to experience EOS world, you need to stake EOS first.
What is STAKE?
To record data on EOS blockchain, you need three types of resources: CPU, Network, and RAM. EOS ecosystem allows holders to use these resources on the blockchain platform without spending EOS.
You might ask how to utilize resources. You can exchange EOS with resources, and this exchange is called ‘Stake.’ Do not worry about losing your EOS by exchanging it with resources. You can ‘Unstake’ to get your EOS back. As you see in the EOS resource system, you don’t need to buy the resource, but lease them.
Then, why does EOS use the concept of leasing?
If the resource is a concept that an individual has to create and own, then it will be inefficient until a certain number of people demand it. If everyone has to mine resources directly, someone can have more resources than they need, and someone can run short. But what if someone could provide resources and the others lease it as needed? More resources can be produced and utilized more efficiently.
How do I stake my EOS?
I will demonstrate how to stake your EOS using NOVA Wallet.
’Balance’ shows the amount of liquid EOS, and you can transfer or stake within the remaining ‘Balance’. On the right side, you can see the amount of staked EOS. Now you know that the staked amount of EOS means the exchanged amount of EOS for utilizing resources.
1. Click ‘Stake’ button and put the amount of EOS willing to stake.
2. Set the ratio between resources(CPU and Network).
CPU determines the time of mainnet computing usage, and Network determines the amount of network. The NOVA Wallet allows you to set CPU and Network resources in percentage in the selected EOS amount.
Is it possible to withdraw staked EOS immediately?
Staked EOS is not liquid because it is assigned to lease the resources. If you want to send EOS to someone or transfer it to an exchange, you need to unstake EOS first. Leased resources can be switched back to EOS at any time, but the process takes three days(72 hours). This process is called ‘Refund’. During this process, you will not be able to check with the amount of refunding resources or EOS. After the process, you can check the status of EOS switched safely. So do not worry :)
Why I have to Stake my EOS?
There are two reasons why you should stake your EOS.
- Even transferring small amounts of EOS requires computing resources that works a fuel within the mainnet. That means that you need to stake to get the CPU and Network resources required for some actions on EOS mainnet. In other words, staked resources are required to use various services running on the EOS chain; we call these services as DApps.
- You can also vote to elect 21 BPs. Voting for good BPs is essential for the healthy growth of the EOS ecosystem. Please note that even if the investment is a priority reason of holding EOS rather than the development of the EOS ecosystem, the development of the ecosystem is a prime factor that affects value of EOS. If you want to learn about the Voting system, please check this post: What is Voting on EOS
I hope this post will help you understand EOS and ‘Stake’. In the next post, I will write about resources in more detail. Thanks for reading:)
[NOVA Wallet]
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