What is Staking?
A Proof-of-Stake blockchain requires node operators to run the network. In other words, someone needs to make sure the system is working and transactions are being recorded.
By producing blocks where transactions are recorded, node operators ensure the stability of the blockchain. For their service, the blockchain rewards them somehow. After all, noone wants to work for free.
For that reason, many groups want to be node operators in order to receive those rewards. But there is only a limited amount of spots for the job. Similar to an election process, people who hold the native token of the blockchain “vote in” their favorite block producer by staking their coins with them.
Why would people stake their coins, you might ask? It’s simple. Node operators share some of their profits with their stakers!