Is Staking Good For The Cardano Ecosystem?


Very insightful article.

We think just that PoS is more efficient than PoW.

But this article make me think deeply about how PoS will affect the Cardano ecosystem economically.

Hello @yongyong2

Thank you for pointing out another source of misinformation about Cardano.

Author of this article seems to be confusing Cardano with PoS chains that force individuals to lock up their ADA for staking. Cardano doesn’t. The only thing you delegate on Cardano is your right to be part of block producing protocol. You never send your ADA away to delegate. As long as your ADA is in your wallet 1 second before Epoch change you will get your staking rewards. Then you can move your ADA to any dApp for 5 days with out loosing anything. If you would like to read more about delegation cycles on Cardano check out this article:

Besides that, the author of that article seems to believe that you can’t earn staking rewards while using dApps. This is also incorrect. Unlike lock-up type of PoS blockchains Cardano already has a system in place where you can keep staking while part of a DeFi dApp. The competition will be between the dApps that let you keep staking or ones that don’t. Any dApp that holds your ADA can choose to hold it in pointer address which will keep your ADA delegated to the pool of your choice while it’s waiting. You can read more about pointer address here:

So, authors claim that staking disincentives development or that it’s a large opportunity cost are baseless.

This may be true of PoS systems where you have to lock up your tokens. However, that is NOT the case on Cardano network.

Even their PoS chart is incorrect.

On Cardano you don’t send tokens anywhere when you delegate. Also, the network distributes rewards to all participating wallets, not just “validators” (assuming the author is referring to stake pools).

Best case scenario is that this is just a misinformed individual/ group. Worst case scenario is that this may be a low effort scam unfolding. I’m not sure which. So, be careful when you read claims like this and verify your info on official pages.

Good starting point to verify such info is Cardano official docs :smiley::

Keep your ADA safe and DYOR ! :v:

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Well, you may misunderstand the point of the article.

Anybody has no wonder Cardano participants can delegate their ADA and the ada is in his/her own wallet.

But during delegation, the ADA can’t be used on other dApps.
After the delegated ADA is transferred, the ADA no longer belongs to me.

The only happy story for Dapps & user is that Dapps get user’s ADA and stake it then give the yield from staking to the users.

The posting doesn’t assume the kindness of Dapps.

That’s not true. After the snapshot you can move your ADA and it’s still considered delegated.
You can check in the link above how delegation cycle works.
On Cardano after you delegate you can move your ADA in to dApps and it’s still delegated until next Epoch. Then you can move it back for 1 minute and then move it away again for 5 days into dApps and it’s still considered delegated.

Also not true, They can just use pointer address so even when you move your ADA it stays delegated to your wallets pool and you still get the rewards. You can read about how that works here:

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