Atomic Wallet

Atomic Wallet is a decentralized exchange that uses liquidity pools (LPs) to make markets instead of a typical order book. These pools are defined by smart contracts that facilitate …

Atomic wallet has many staking options that help users earn a passive income. But before getting into that, here is a brief description of what staking is –

Staking involves holding funds in a wallet. These funds help to support the operations of a blockchain network. Users can stake coins directly from their wallet, exchanges also offer staking services to their users. Staking was originally conceived as an alternative to the PoW (Proof of Work) model. Proof of Stake (PoS) is an alternative and efficient way of reaching a distributed consensus that would allow for greater network scaling.

What is Proof of Stake (PoS)?

Users that are familiar with Bitcoin will also be familiar with Proof of Work (PoW). Proof of Work is the mechanism that allows transactions to be gathered into blocks, which are then linked together to create the blockchain. Proof of Work is a very robust mechanism that facilitates consensus in a decentralized manner. However, unlike Proof of Work blockchains that solely rely on mining to verify and validate new blocks, Proof of Stake (PoS) chains validate new blocks through staking, allowing the blocks to be produced without being reliant on mining hardware.

Instead of competing for the next block as they would have done in a Proof of Work system, Proof of Stake validators are selected based on the number of coins they are staking. The validator can then stake the coins present in their wallet to create the new block relative to the amount of coins staked. Many exchanges like Kraken, Binance, CEX, and Coinbase have already started offering staking.