Staking is a way to grow your crypto by making it available for network validation. With SportStake, you stake Polkadot (DOT) and receive daily staking rewards, while 5% of the proceeds automatically go to your favorite sports club."
What is Proof of Stake?
Proof of Stake is a way to keep cryptocurrencies secure. Instead of powerful computers solving puzzles (like with Bitcoin), it involves people "locking up" their coins in the network.
Staking
Staking means locking up your cryptocurrencies for a period of time. It's like putting them in a savings account. You can't spend them, but they work for you.
Staking Rewards
When you lock up your coins, you receive rewards. These are new coins you get as a thank you for helping keep the network secure. It's like earning interest on your cryptocurrencies.
Validators
Validators are people who have special computers to make the network function. They verify all transactions and group them into blocks. To become a validator, you need to have a lot of coins that are staked.
Nominators
Not everyone can be a validator because you need many coins. That's why as a nominator, you can "lend" your coins to a validator you trust. You're then also helping the network and get a portion of the rewards.
Commission of a Staking Pool
A staking pool is a group of people staking together. The validator managing the pool usually takes a small percentage of all rewards as commission. For example, if the rewards are 10% per year and the commission is 5%, you get 9.5% and the validator keeps 0.5%.
This way, everyone works together to keep the network secure, and everyone profits from it!
