Crypto Knowledge Buffet 2.0: Cryptocurrency Mining and Staking by @swaylee

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Hello Tron lovers and traders,
I've come up with another crypto knowledge buffet idea. People just hear about mining cryptocurrencies and staking for rewards. One might assume crypto mining is easy in all cases but it isn't. I have come to throw more light on cryptocurrency mining in general as some tokens have easier mining methods and strategies to be part of the mining process. Also I've noticed that outside this community, many people don't know about staking or what the benefits of staking might be so I've come to throw more light on these concepts. Let's have a good time reading and learning.

Cryptocurrency Mining

When we think of mining in layman terms, the first thing that would come to mind is the extraction of useful raw materials from somewhere. It could be from under the ground or under water. But when we think of it as crypto inclined people, it takes a whole new meaning.

It is kind of a competitive process where nodes get to verify and record transactions on a blockchain network and they are paid mining rewards for their mining efforts. Complex puzzles are given to them and whoever solves it first earns the right to record the next transaction and gets rewarded for their service. This is why I called it a competitive process. Mining in crypto is really tasking and difficult and can be done by those who possess the required software and hardware facilities for it. The consensus mechanism used here is the proof-of-work mechanism. Examples of cryptocurrencies that use this proof-of-work mechanism is Bitcoin. Now a consensus mechanism is a way of agreeing on the details of a particular transaction done by a node. It is a set of rules which are aimed at making transactions truthful and fair. The two most popular kinds of consensus mechanisms are proof-of-stake and proof-of-work. I would have to end this here for now before we end up venturing into another today.

Cryptocurrency Staking

Like I said earlier abt consensus mechanisms, proof of work involves mining. Here when we talk about staking then we bring up the proof of stake consensus mechanism. Cryptocurrencies like Ethereum2.0, tezos who use this consensus mechanism enables users to stake tokens which are then used to validate transactions. Unlike the proof-of-work mechanism, the proof of stake mechanism does require one to start solving complex puzzles which would be time jerking instead they make use of the coins which people have staked/locked up in the blockchain.

Here instead of miners, they are called validators. Now those who staked and held the highest would be chosen by the network to be the validators who perform the transaction validating and recording process. Some people often ask Do you get anything for staking? The answer is yes you do. The proof of stake mechanism rewards those who stake their currencies (not just any currency) because not only does it help the validation process but it improves the blockchains' efficiency and makes it more secure. The larger the stake, the greater the rewards. In this same post I shall show you an example of staking and you would even see the rewards gotten from the last amount I staked. POS offers faster transactions and lower transaction fees unlike the POW

Staking 170 TRX to Contribute to The Tron Blockchain by voting Super Representatives.

Super Representatives in the Tron network are those who record blocks just like validators and anyone on the blockchain can apply for it after paying a fee of 9999 trx. There are so many super representatives so they kind of change shifts every 6hrs. It would be a hassle to start the whole process of staking from scratch so I would refer you all to this post I made on how to stake TRX for energy/ bandwidth and how to use staked TRX to vote for super representatives.

You start by entering the app and clicking on the vote icon at the right side of the app home screen. Ensure you have staked TRX already so you would have voting power. 1 staked TRX = 1 voting power.

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You would see a large array of super representatives to choose from and the yield of your vote if you vote for them. I decided to scroll down a bit and vote for Poloniex which gives about 6.03% yield.

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You click on the one you want to vote (Poloniex) then you click on vote when the confirmation screen pops up. You would then be taken to another page where you would be asked to input the amount you want to use and vote for the representative of which I used the whole 170 voting power. As soon as you click the confirm button, you would be given a space to put your password so as to finalize the transaction. Once that is done you are all set. If the representative you choose gets to mine then you should expect rewards in about 6hrs.

So here you have it folks, there are more than just 2 consensus mechanisms but these are the main two and the only ones I focused on in this post. I hope I have been able to expand your knowledge based on mining and staking. I encourage you long term HODLers to stake the tokens you have so they can earn you more instead of leaving then idle in your various wallets. It would be beneficial to both you and the blockchain. Thanks for reading.

(All the screenshots used in this publication were taken by the author on his account using his Mobile device)

[10% to @tron-fan-club]