NFTs are tokenized assets that can be hosted and securely maintained on NFT platforms.
We all know cryptocurrency staking, thanks to which you get a return on your investment. Currently, you can also make money by wagering your Non-Fungible Tokens (NFTs)! By staking your non-fungible tokens (NFTs) on NFT staking platforms, you can earn additional returns on your investment. This development has made NFTs even more attractive.
More and more people are looking for new ways to make money without having to work for it. In the past, passive income was something the rich could get from the bank because interest rates on savings accounts were pretty high. Nowadays you get almost no interest on your money in the bank; in some cases you even have to pay for your savings! A new era alternative has been found due to relatively high rewards for staking cryptocurrencies and NFTs.
See also: NFT Marketplace: How to buy and sell non-fungible tokens
What is NFT staking?
Staking your NFTs is one way to get your unique token working on the blockchain. NFTs are often associated with digital images, such as B. the Bored Ape Yacht Club collection, but they can be anything from digital art to video files to in-game items. NFT staking means tying your non-fungible tokens to a platform or protocol. In exchange for this action, you will receive a staking reward. This allows you to earn extra while remaining an NFT owner.
You can compare this staking method to decentralized finance (DeFi), where cryptocurrencies are lent or provided to liquidity providers to be rewarded by interest or transaction costs incurred by others. This method of receiving interest is similar to receiving it through a bank, but in this case there is no intermediary. NFT staking belongs to the world of decentralized finance while the banking form is centralized.
How does NFT staking work?
NFT staking works the same way as cryptocurrency since NFTs are tokenized assets. Also, not every non-fungible token can be staked in NFTs, just like not every token. Since NFTs are tokenized assets, you can stake them on NFT staking platforms where you can secure them. This is possible with the help of a smart contract on the appropriate blockchain protocol.
While NFT staking is a relatively new concept, many NFT holders are very excited about this development. This is because the non-fungible token is unique, making holders reluctant to sell it. This is a big difference from cryptocurrencies, where you can easily buy and sell cryptocurrencies. To stake an NFT, you need a crypto wallet that must be eligible for that NFT.
First, verify that your preferred wallet is compatible with the blockchain that hosts the NFT. You then need to connect the wallet to the staking platform so that you can send your NFTs to the platform. This process can be compared to placing your coins. You can do both by going to the betting section of the platform.
NFT Staking Rewards
The type of staking reward NFT holders can receive for staking their NFTs depends on the platform and the type of NFT. Most NFT betting platforms offer recurring rewards, often paid out on a daily or weekly basis. Often these rewards are paid in platform utility tokens, but there are exceptions. Regardless of the token used for the staking reward, you can exchange and possibly convert staking reward tokens to other cryptocurrencies or fiat money.
In addition, there are staking platforms with Decentralized Autonomous Organizations (DAOs). Here, NFT holders can freeze their assets in a DAO pool, also known as an NFT staking pool, which allows them to participate in governance tasks on the platform. This often includes the right to vote when submitting proposals. It is also possible to make suggestions yourself, but that depends on the DAO.
Related: Understanding Staking Pools: The Pros and Cons of Cryptocurrency Staking
Since most of the NFTs in the NFT market belong to different blockchain games, there are also different betting options in games where you need to make money such as: B. Axie Infinity (AXS), The Sandbox (SAND) and Splinterlands (SPS). In Play to Earn games you can earn not only cryptocurrencies but also NFTs. This allows you to earn NFTs for free and then place bets!
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