These NFTs are sold in the secondary market or remain entirely dormant in the owner’s wallet. There is a better way for NFT holders to put their digital assets to work and generate passive income through staking. Let’s explore all the possibilities of staking your NFTs while retaining their ownership.
What is NFT Staking?
Before adding any data on a blockchain, it goes through a global network of transaction validators for authenticating the transactions. The authenticators (or stakers) are selected based on the amount of cryptocurrency they stake towards validating the transactions. In return, the stakers are rewarded in native cryptocurrency for contributing to the transaction.
- What is NFT Staking?
- How does nft staking work
- Where Can You Stake Your NFTs?
- How nft staking works
- NFT Staking mechanism
- How does nft staking work-
- Where to stake NFTs
- Zookeeper (ZOO)
- How does nft staking works
- Final Words
- How does nft staking working
- How Does NFT Staking Work?
- Where can I stake NFTs?
- MOBOX (MBOX)
- Mutant Cats
- What is NFT staking and how does it work?
- 4) Percentage of total NFTs staked
- The best NFT staking platforms
- Similar Posts:
How does nft staking work
If you own a rare NFT artwork from a famous collection or a popular NFT game asset, gaining an annual yield of 100% is no big deal.
Where Can You Stake Your NFTs?
As we mentioned earlier, NFTs are “unique” or non-fungible, so you can not stake them on most DeFi platforms where you commonly stake other cryptocurrencies. However, there are many platforms on the blockchain with dedicated NFT staking protocols.
Onessus is a blockchain-based gaming platform that is sustained by NFT creation.
For staking NFTs of the blockchain games on the platform, Onessus has a dedicated NFT staking platform known as WhenStaking.
How nft staking works
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NFTs have a lot more value than meets the eye.
To some they may appear to just be JPEGs, but these digital assets have the potential to transform every industry, from event ticketing to digital art and “phygital” goods.
The hidden value of NFTs lies beneath the surface in their intrinsic utility, and that’s something that can’t be captured with a screenshot.
Another thing that most people don’t know about NFTs is that they have the ability to earn passive income.
Many collections allow users to stake NFTs to earn rewards.
What is NFT Staking?
NFT Staking is a way to make use of your NFTs to earn a passive income. An NFT holder will attach one’s NFT onto a blockchain to earn staking rewards.
Rewards earned from staking depend on the Annual Percentage Yield (APY), the staking duration, and the number of NFTs staked. This information can usually be found on the platform on which you choose to stake your NFT.
This article will cover how to stake your NFTs and some factors influencing their profitability.
NFT Staking mechanism
Staking usually involves a Proof of Stake (PoS) Mechanism. It is a consensus mechanism involving validation nodes and native tokens.
To stake a new NFT, randomly chosen validation nodes will propose new blocks to the current blockchain.
How does nft staking work-
Because the criteria for various projects varied, it’s best to double-check with your selected projects before purchasing NFTs.
Where to stake NFTs
The majority of NFT staking chances come from play-to-earn games as of December 2021. Two examples are Zookeeper and MOBOX. Binance Fan Token Platform and Doge Capital, for example, are building NFT staking capabilities on their platforms.
Zookeeper is a yield farming DApp that is gamified.
It offers NFT staking in several mascot-themed liquidity pools. Dual farming is allowed in all liquidity pools in Zookeeper, which means you may earn both the utility token ZOO and the WanSwap Liquidity Provider (WASP) token as a reward.
You may opt to lock your tokens for a certain length of time, up to 180 days, to maximize your APY rewards.
How does nft staking works
With the help of NFT staking, you can stake your rare digital assets and increase the liquidity of your portfolio.
Although the concept of NFTs is in its infancy, NFTs are highly desirable and disrupting the crypto market as big investors keep finding their development. Reselling NFTs has been the go-to method for investors to see a return on their investments, but now anymore.
You can now earn passive income while holding on to your rare virtual assets as you wait for their value to increase. You might not have bought your NFTs to stake them, but it adds incredible growth to your portfolio.
NFT staking is still a new concept under development, and you should do proper research on the platform before taking any of your NFTs.
Apart from NFT staking, you can also earn through lending your NFTs.
How does nft staking working
This method of validating blocks of transactions by locking up your crypto assets is known as the Proof-of-Stake model.
Like any crypto staking, NFT staking involves locking up your non-fungible digital assets on a blockchain protocol to generate interest. Staking is one of the main ways investors earn profit in the crypto space as it is low risk, high reward, and very secure.
Duration and yield of staking are generally predetermined to make it a transparent process. In fungible crypto staking, more yield is given to those who stake more coins.
Then how are NFTs staked as they are non-fungible and unique?
How Does NFT Staking Work?
Unlike popular cryptocurrencies such as Ethereum and Bitcoin; NFTs can not be grouped for staking as they are “non-fungible”.
The requirements vary from different projects, so it’s better to check on your preferred projects before acquiring the NFTs.
Where can I stake NFTs?
As of December 2021, most NFT staking opportunities come from play-to-earn games. MOBOX and Zookeeper are two examples. Some projects are also developing NFT staking ability on their platforms, such as Binance Fan Token Platform and Doge Capital.
MOBOX is a play-to-earn gaming metaverse that combines DeFi yield farming with NFTs.
Built on the Binance Smart Chain, it allows players to stake NFTs to earn rewards in its native cryptocurrency, MBOX.
The MOBOX metaverse is called MOMOverse, and the NFTs are called MOMOs. You can mint, earn, or purchase MOMOs from the NFT marketplace.
Each MOMO has different qualities and a randomly generated hash power.
Avatars in this 3D voxel-based collection can even be used in metaverses like The Sandbox.
CyberKongz are available on OpenSea for a current floor price of 6.9 Ethereum (~$19,000).
Mutant Cats is a collection of 9,999 feline avatars built on the Ethereum blockchain. Holders can stake their Mutant Cats to earn $FISH, the native utility token of the project.
$FISH tokens pay out at 10 per day for each staked cat, and represent fractionalized ownership of the DAO’s vault assets. The collection’s DAO distributes ownership of Cool Cats, CryptoPunks, Bored Ape Yacht Club and other blue chip NFTs.
Mutant Cats are available on OpenSea for a current floor price of 0.193 Ethereum (~$541).
Some NFT projects share part of the revenues they get with the community of NFT holders. These usually come from secondary market sales and royalties.
But as the NFT market grows, developers, artists, and collectors are exploring new use cases for their NFT collections.
One of the latest use cases is using NFTs as utility tokens in staking platforms. For example, in some gaming metaverses, NFT collectors can stake their NFTs to boost their game character’s abilities and earn extra rewards.
What is NFT staking and how does it work?
As the name suggests, NFT staking refers to the locking up of NFTs on a platform or protocol to receive staking rewards and other privileges.
NFT for 1 ETH when Ethereum is $3,000, and sell for 1.1 ETH when Ethereum is $2500, you’ll actually be selling at a loss.
4) Percentage of total NFTs staked
If you’re hesitant to stake an eligible NFT, you can take a look at the project’s website to see the percentage of all NFTs that are staked. A higher number will indicate a healthy signal that NFT owners are dedicated to holding for the long run.
Although not a guarantee, there is a lower chance of a mass sell and price dump if a large percentage of total NFTs are staked—especially if there is a definite lockup period.
The best NFT staking platforms
If you own an NFT eligible for staking, you can check the official collection website for complete instructions on how to stake it.
There are also collection-agnostic platforms built to allow users to stake NFTs from multiple collections.