Zilliqa has announced the date for the launch of staking open to all users, scheduled for June 18th.
Before understanding the concept of staking, let’s take a step back and explain that this blockchain is the first to actually apply the concept of sharding, allowing a high scalability for its blockchain as it divides nodes into subnets.
This way it is possible to achieve several networks in parallel in order to divide the load of block and transaction management: with this system, it is possible to easily reach about 10 thousand TPS (Transaction per second).
This is a similar solution to the one that will also be applied to the upcoming ETH 2.0.
As there are several independent nodes, now the consensus model is PBFT (Practical Byzantine Fault Tolerance) and therefore each node checks each transaction.
How does staking on Zilliqa work
Here is where the proposal to introduce staking, thanks to ZIP-3, comes into play. a
Considering that there are several nodes, new “seed nodes” will be introduced for staking, which are added to the existing network in exchange for locking a certain amount of Zilliqa (ZIL).
We are talking about millions of ZIL staked and for this reason the parameters reserved for this operation also had to be adjusted: in fact, it went from a maximum of 700 million ZIL and 70 million ZIL per node and a percentage of 10.42%, to a more appropriate one which is 610 million ZIL maximum and therefore 61 million ZIL per node and an annual return of 10.03%.
As mentioned, the investment is not small and that is why exchanges will start staking these ZIL on the mainnet, starting next June 18th.
For example, the KuCoin exchange will create a soft approach with the Pool-X and will have these parameters:
- Users will be able to receive the rewards even without locking the funds, so all they need to do is place them in the relevant Pool-X and receive the rewards daily;
- To calculate the rewards, KuCoin will take daily snapshots and then distribute the reward the next day;
- There is no limit to the number of participants, but it is noted that with a maximum of 61 million, if the pool were to double and thus create a second seed node, the reward will be halved, i.e. from 10% to 5%;
- The rate will be the same for everyone, i.e. 10% for a maximum of 61 million ZIL and 5% if 122 million ZIL are staked.
Finally, the post concludes by explaining that the next partner that will support the staking will be Binance, while among the other partners there are Xfers, Aqilliz, Hg Exchange, ChainSecurity, Switcheo, Asteria, Elliptic, Flipside Crypto, Long Hash, Tribe and OpenNodes.
To engage in staking, users will only need to access an exchange and register: this is a centralized type of staking, funds are entrusted to a third party and in a common pool, so if there are problems or anomalies, there’s also the possibility to lose funds.