Are Ethereum (ETH) & Calyx Token (CLX) the best cryptos to stake?
Staking is a smart move if Ethereum (ETH) and Calyx Token (CLX) maintain their bright long-term prospects.
There are few options for making money that don’t require you to put in constant effort. Staking cryptocurrency is one of those methods that is gaining popularity.
Here’s why staking Ethereum (ETH) and presale newcomer, Calyx Token (CLX), could be a fantastic way to earn passive income.
Only blockchains that use the proof-of-stake consensus mechanism support staking. These blockchains allow you to commit your tokens in order to support transaction verification. You will be rewarded in exchange.
Ethereum (ETH) began with a proof-of-work model that does not allow for staking. Staking ETH tokens became possible after the Beacon chain was launched in December 2020. This chain will merge with Ethereum’s (ETH) mainnet later this year, bringing staking to the entire Ethereum (ETH) network.
What can you earn by staking your ETH? It depends on which cryptocurrency exchange you use and how long you’ve been holding your ETH for. The rewards can be quite impressive.
The highest annualised yield available for staking ETH at the time of writing is 10.1%. Binance is offering a particularly juicy yield for a 120-day staking period. Other exchanges with yields of 4% to 8% for shorter periods are readily available.
These yields are higher than those offered by the majority of dividend stocks.
But when you flip the coin…
Why wouldn’t everyone want to stake ETH tokens if they could earn double-digit annualised yields? The main disadvantage is that your ability to sell is limited.
When you stake ETH tokens on cryptocurrency exchanges, you’re usually required to lock them up for a set period of time. Even when the staking period is over, you may not be able to sell right away. Unstaking periods can last for several days on some exchanges.
When the price of the tokens is rapidly falling, this inability to sell can be especially problematic. This exact scenario has played out in recent days. Over the last week, Ethereum (ETH) has lost more than 30% of its value.
It’s possible that the downturn will last for a long time. While staking can help to mitigate losses, the yields won’t be enough to compensate for major losses like we’ve seen this month.
Why stakeholders are fascinated by Calyx Token (CLX)
Once it comes out of presale, Calyx Token (CLX) will be a permissionless, community-driven liquidity protocol that enables multi-chain crypto trading and liquidity sourcing from a variety of liquidity sources to enable trading and token swaps at the best possible prices.
CLX holders receive a portion of the fees collected by Calyx from the ecosystem’s liquidity pools. Calyx Token (CLX) has a unique staking model in which the developers believe that all stakeholders should share responsibility for determining the success parameters that will guide Calyx Token towards growth and sustainability.
Calyx Token (CLX) will achieve this by incorporating the CalyxDAO and providing community members with fair representation on agendas that benefit the entire ecosystem.
If Calyx Token (CLX) stakeholders want to get more involved, they can become a Liquidity Provider, a role that is mostly available on decentralised exchanges. Anyone can become a Liquidity Provider or start a liquidity pool by donating an equivalent amount of underlying tokens in exchange for LP tokens.
Taking a long-term perspective
Staking is a bad idea if you don’t believe in the cryptocurrency’s long-term prospects.
It’s a different story if you believe Ethereum (ETH) and Calyx Token (CLX) will last for several years and that they’ll continue to be strong investments. If this assumption is correct, staking could be a fantastic way to generate passive income.
Enter the Calyx Token (CLX) presale now: