Growing your wealth requires time and self-discipline. Staking your coins to earn more tokens is the perfect way to accomplish both of these simultaneously.
Staking, or proof-of-stake (PoS), is a unique alternative to the proof-of-work consensus algorithm most commonly used in blockchain networks. PoS essentially “stakes” your coins as collateral so that you can be rewarded with more tokens when they return. The advantages are obvious: keeping your tokens locked up will reduce the likelihood of selling them during a temporary dip in their value.
In this article, we’ll explore what staking means in an OHM crypto network, how it works, and how you can easily participate. Let’s get started!
What is staking?
Let’s start with the basics. Staking is the process of securing a blockchain network with your tokens. You will be rewarded with new tokens for doing so.
How does this work? Every time a block is mined on the blockchain, the reward is distributed among all participating nodes responsible for validating transactions and ensuring the safety of the network. Anyone who owns tokens is eligible to receive a percentage of the reward.
OlympusDAO (OHM) refers to the community-owned reserve currency of Olympus. They launched this reserve currency for the purpose of creating an alternative economic system that meets their stakeholders’ needs.
Staking in OHM refers to the process of participating in the safeguarding and maintaining of the Ethereum Network. The catch of your participation is that you can earn rebase rewards.
In OHM, their rebase tokens are minted every 2200 Etherium blocks, which takes place every 8 hours. This is possible as long as 1 DAI in their Treasury is capable of backing it. Their Treasury operates to support the value of OHM tokens through other cryptocurrencies, like DAI and ETH.
With the PoS consensus algorithm, you will receive rewards based on how many tokens you own and how frequently you send them to stake. The more you stake, the more rewards you will receive. Staking rewards you with more tokens because it helps secure the blockchain network.
How much can I earn with Olympus staking?
There is no constant amount of rewards you can get for Olympus staking. It is because the number of rewards you receive will depend on a few factors, such as:
- The number of tokens you own – The more you own, the more rewards you will receive.
- The number of hours you stake – The more time you spend staking, the more rewards you will receive.
- The network difficulty – The higher the difficulty, the lower the rewards.
- The network exchange rate – The higher the exchange rate of the token, the lower the rewards.
That said, you can expect to earn a few thousand tokens per month when staking Olympus. Although this is a very conservative estimate, you could easily make more.
Keep in mind that the network difficulty will likely increase over time, lowering your rewards. If that happens, you can always stake more tokens to compensate.
How to buy and stake OHM
Now that you know what you could earn with Olympus staking, you are ready to understand how to buy and stake.
There are a few requirements that you must meet before you can stake in Olympus, but they’re really relatively easy to meet. These are a few things you’ll need:
- A computer – You can’t stake with an iOS or Android device, so use a computer. This computer should also be secure. Make sure that it is free of viruses or malware.
- A wallet – You’ll need an ERC-20 compliant wallet, such as Metamask, to stake. Ensure that your wallet is securely encrypted to protect your digital assets.
- Some OHM – You’ll need to own OHM to stake.
- Internet connection – You’ll need an internet connection so your wallet can communicate with the blockchain.
Purchasing OHM at an exchange rate seems yet to be available in the US. If you live in the US, you can still participate by entering a peer-to-peer (P2P) marketplace transaction to connect with cryptocurrency buyers and sellers.
This transaction is called the decentralized exchange, which grants you access to many products and services available. Having a DeFi Wallet allows you to explore the products and services offered in decentralized markets.
Here are the steps on how you can buy OHM under a decentralized exchange:
- Step 1: Look for OHM on a decentralized exchange. You can use Sushiswap so that you can compare exchange rates and get the best price.
- Step 2: Purchase enough ETH or DAI to exchange for OHM. Make sure that you input the correct currency.
- Step 3: Although you can select the currency based on your wallet’s available balance, Olympus recommends DAI to minimize slippage.
- Step 4: After selecting the amount of OHM you wish to swap, click the “Approve” button. Then, proceed by signing the transaction.
- Step 5: After the transaction has been approved, click the “Swap” button. Your OHM wallet should now reflect your current balance.
Staking is the perfect way to earn passive income without lifting a finger. After connecting the wallet of your choice, just proceed to the followings steps:
- Step 1: Click the Connect Wallet button to select your preferred wallet.
- Step 2: Click Stake, or scan the QR code that will reflect on the screen.
- Step 3: After that, you’ll be allowed to type the number of OHM you want to stake. Just input the amount and press the Approve button.
- Step 4: You can Confirm the approval and head back to the Stake OHM button.
- Step 5: Wait for your wallet to pop on the screen and pay the transaction fee required.
Transaction time depends on your desired speed. But the good thing is that you can visit their website, and your balance will reflect there.
How Ohm Staking Works
You can Stake OHM by going to the Stake page of OlympusDAO’s website. Just follow the instructions above on how you can participate in the Staking. If you’re new to staking and are unfamiliar with some of the terms, you can take a look at the photo below and be familiar with how staking works.
- The APY stands for the Annual percentage yield. It refers to the annualized rate return that’s based on the reward yield. Since sOHM rebases in an exponential form, it records the effect of compounding.
- TVL measures all the staked OHM in dollar form.
- The Current Index is your guide to tracking your gain. It begins from 1 at epoch 0 and gradually increases every epoch.
- Your Balance informs you of the amount of unstaked OHMs in your wallet.
- Your Staked Balance refers to the amount of staked OHMs in your wallet.
- Next Rebase refers to the remaining time until the next rebase.
- Reward Yield refers to the amount of sOHM balance increase you’ll have at the beginning of the next epoch.
- ROI (5-Day Rate) refers to the estimate of sOHM balance increase in the next 5 days, given that the reward yield is constant during the period.
Pros and cons of staking Ohm
● The Olympus Treasury secures your fund
● The status of OHM is transparent and readily available
● A decentralized network powers them
● Staking OHMs can be made into a profit
● The price may fluctuate at any time
● They are subject to technical problems
Staking is an excellent way to earn more tokens as your investment grows. Staking OHM is a great starter because you can easily set things up with minimal effort. You’ll earn more tokens when the token price increases, the network difficulty increases, and the block reward is higher.
1. How long does it take to stake OHM?
Typically, the time it takes for your OHM tokens to mature and begin staking depends on the number of coins you hold. The more OHM you own, the more likely your staking rewards will kick in sooner. Once your tokens are ready to stake, your computer will automatically begin the process of securing the OHM blockchain and verifying transactions.
The time it takes for your staking rewards to kick in will depend on how much OHM you hold. It’s important to note that all staking rewards are variable and depend on the number of transactions occurring on the network. As more people begin to stake OHM, the frequency of tips will decrease.
2. How many OHMs do I need to stake?
Staking is a great way to earn passive income. If you’re planning on using OHM to secure your network and earn rewards, you’ll first need to figure out how much OHM you need to stake to make a return.
Staking rewards are directly related to the amount of OHM you have, so the more OHM you have, the more rewards you stand to earn. We advise you to have enough OHM to earn at least 5% interest to make staking worth your time. If you’re hoping to earn rewards quickly, you’ll need a sizeable investment.
3. How much does it cost to stake OHM?
The cost of staking OHM is negligible, but you’ll want to ensure that you have enough OHM to earn a significant return on investment. If you’re hoping to earn rewards quickly, you’ll need to have enough OHM to make at least 5% interest.
The more OHM you have, the more potential you have to earn rewards quickly. Keep in mind that in staking OHM on Olympus, you’ll receive staked OHM (sOHM) in return, following a 1:1 ratio.
4. Is OHM crypto a good investment?
OHM is a unique token that promises excellent returns for investors who stake their coins for a significant amount of time. For those interested in earning rewards quickly, you’ll need a good amount of OHM to stake. It’s a choice for those who are looking for a good investment and a way to earn some extra passive income.
5. How do you calculate OHM Staking rewards?
The easiest way to calculate your staking rewards is to use a staking calculator like the one found on the OHM website. Once you have enough OHM, you’ll want to stake your coins for as long as possible to earn the most rewards.
If you buy OHM now, you can decide to sell when they are ready to stake or take the long view and hope they rise in value as time goes on. If you are interested in staking, investing before the end of the OHM token sale is advisable.