77% of Eligible Solana ($SOL) Is Being Staked on-Chain, Data Shows
Over 77% of Solana’s $SOL tokens are being staked on the cryptocurrency’s network and earning their holders yield, so much so that staked value on the network surpassed $84 billion, according to data from Staking Rewards.
As first reported by Benzinga, the network’s staking rewards have as such been making Solana a top choice for investors looking to earn interest in their cryptocurrency holdings. Staking allows users to earn interest in their crypto by helping secure the underlying network.
According to CryptoCompare, staking on-chain is possible with cryptocurrencies using a Proof-of-Stake (PoS) consensus mechanism. PoS networks are often more energy-efficient than PoW networks and maintain a certain degree of decentralization.
Solana itself is a high-performance blockchain founded by former Qualcomm, Intel, and Dropbox engineers that uses a delegated Proof-of-Stake (dPoS) consensus algorithm. The network uses a unique method of ordering transactions to significantly improve its speed and throughput.
Staking on Solana has been surging along with the number of daily active wallets on it, which recently surpassed 200,000. In mid-September, the network had around 67,000 active wallets per day.
Over $80 million worth of tokens have been staked on the Solana network, making it the most popular blockchain for investors looking to earn staking rewards. Next to it comes Cardano’s network with $43.8 million staked in it, followed by Polkadot with $43.3 million, with Ethereum coming next at $34.6 million.
It’s worth noting that on Solana and other blockchains there are decentralized applications offering liquidity solutions for staked assets. While normally users would have to lock in their funds to earn staking rewards, these solutions create a token pegged to the value of the staked asset that can then be freely used. That token is redeemable for the asset when it’s unstaked.
As CryptoGlobe reported, a panel of experts has recently suggested that the price of $SOL could surpass the $5,000 mark by 2030 and hit $1,17 this year.
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.
Featured image via Pixabay
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