What is Cronos (CRO) and how can you stake it? We will take deep dive into these questions in this guide along with the benefits and risks associated with staking CRO.
With the growing adoption of proof-of-stake (PoS) blockchains, staking has become a popular method of growing portfolios without actively trading cryptocurrencies.
Unlike the proof-of-work (PoW) consensus mechanism, which uses a considerable amount of energy for mining cryptocurrency and validating transactions on the blockchain, proof-of-stake works by selecting validators based on the number of native crypto tokens held by the participant.
Similar to earning interest on a saving account, staking is the arrangement that occurs when users — or stakers — entrust a validator to receive and hold their crypto in exchange for proportional rewards paid out in the same cryptocurrency. Besides receiving such rewards, the staker also helps the network remain secure and decentralized.
If you are holding some CRO in your wallet, you may want to check out staking opportunities available for the token. Don’t know how to stake your tokens? Let us help you!
But first, let’s discuss what Cronos (CRO) is and how it is used.
What Is Cronos (CRO)?
Previously called Crypto.com Coin, Cronos is the native cryptocurrency token of the Cronos Chain — an Ethereum-compatible, decentralized, open-source blockchain developed by Crypto.com, a cryptocurrency exchange.
Crypto.com is an exchange that offers various cryptocurrency products, such as a wallet, a brokerage account, debit cards, payments and a DeFi wallet. It was founded in Hong Kong in 2016 by Kris Marszalek, Rafael Melo, Gary Or,and Bobby Bao.
How Does CRO Staking Work?
CRO uses a delegate-proof-of-stake (DPoS) consensus mechanism. Investors earn rewards by delegating their tokens to validators who run nodes to validate transactions on Crypto.org Chain. Block rewards are received in CRO, which are distributed to delegators after deducting commission.
Staking rewards depending on the platform and method chosen for staking. There is no minimum stake requirement for the CRO token, and delegators can stake/unstake anytime.
However, when unstaking their CRO, users will be tied to a 28-day unbonding period required by the Crypto.org Chain. During this period, the unbonding balance will not earn any rewards.
Users should be cautious with the choice of validators as their bad behavior may result in the loss of CRO tokens.
How to Stake CRO
There are multiple options available to users to stake CRO. However, some of the most common are the following:
- Crypto.org DeFi wallet
- Crypto.com app
- Crypto.com Exchange
Crypto.com DeFi Wallet
Source: crypto.com
There are two types of CRO tokens: the Crypto.org native CRO (address starts with "Cro") and the ERC20 CRO (address starts with "0x"). In order to stake on Crypto.org, the CRO native token is required and should not be confused with the ERC-20 CRO token.
To get native CRO tokens, you may use Crypto.com DeFi wallet. Being non-custodial, the wallet requires you to keep the seed phrase safe. You have to make sure you’re using CRO (native).
To stake your tokens, open the DeFi wallet app and tap on “start earning.” Select CRO and add the amount of tokens you want to stake.
Then, tap on “To Validators” to choose one validator.
Review all the details and confirm it by tapping “Confirm Stake.” Once staked, the CRO staked will appear on the DeFi Earn screen.
CRO can be claimed anytime by tapping “Earn” on the navigation bar at the bottom of the DeFi Wallet app. Tap on the CRO asset to view the staking details, and then go to "Claim Rewards" under the corresponding validator. It is recommended to confirm the transaction and authorize it with a passcode or 2FA, if enabled. The earned assets will appear on the CRO wallet's available balance.
Crypto.com App
Source: crypto.com
Staking CRO on the app comes with the following benefits:
- Reserve one of the premium metal Crypto.com Visa cards;
- Receive crypto wallet benefits, such as purchase rebates and extra card cashback;
- Enjoy better APR on the Crypto Credit and Crypto Earn programs.
Rewards are between 10% and 12%, paid weekly depending on the tiers.
Staking CRO in the app is quite simple. You just need to go to the Card option at the bottom-right corner of the app, select your preferred Visa card, click on "Stake CRO" and follow the instructions.
Crypto.com Exchange
To stake on the Crypto.com exchange, you either have to purchase CRO from the exchange or transfer it from another wallet. Go to the “Stake and Earn” section and select “Stake CRO.” Input the number of tokens you want to stake, select “Review Staking,” and confirm.
Source: crypto.com
On the following page, you will see the CRO amount staked and the remaining days until it can be withdrawn.
Is It Safe to Stake CRO?
There are some risks associated with CRO staking. Validators should be selected carefully, and ideally, they should have 99% uptime and over 8% voting power. If validators have too much downtime, they may get penalized, resulting in a loss of 5% of your staked cryptocurrency.
By unstaking CRO, users go through a 28-day process during which they can't withdraw their CRO. Furthermore, those who use the DeFi Wallet have full responsibilty for remembering their seed phrase —if they lose it, they also lose access to the funds stored in the wallet.
Unlike DeFi wallets, a centralized service like the Crypto.com exchange holds the private keys, not the user. This means that if the exchange gets hacked, there is a risk of losing the assets.
Software wallets on mobile phones are relatively safe, but many believe that the best option is to use a hardware wallet that can stake CRO.
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