Staking has become one of the most profitable ways to earn an income while holding on to your cryptocurrencies. Hence, if you are looking for the best Proof of Stake (PoS) coins to invest in 2020, we've narrowed down to the most profitable ones out there. As such, you can make an informed decision on which to invest.
What are PoS Coins
Proof of Stake (PoS) is a consensus algorithm that is used to validate blocks. It defines a mining process where validators that can create a new block must hold a particular coin; as a stake. Once these validators have verified the block, they can earn a higher reward in the same coin that was held.
Therefore, PoS cryptocurrencies are those assets that are mined through this process. PoS cryptocurrencies offer benefits to its holders where they can either run a master node or stake these digital assets in a staking wallet.
Benefits of PoS
PoS has several advantages over Proof of Work (PoW) cryptocurrencies, and some of these are:
- It is less expensive to mine PoS cryptocurrencies since their mining process is energy efficient, and less sophisticated machines can be used in the process.
- Stakeholders in PoS coins can vote and make decisions.
- PoS is an incentive mining process because its users are offered rewards, and the higher the amount staked, the higher their income.
Disclaimer: This is not a get rich quick scheme; however, it could be a side income that comes as rewards on unused coins. Consider it interest on money kept in your savings account; however, this time, you are in total control of your money.
Best PoS Coins to Invest In 2020
1. NEO (NEO):
NEO is often referred to as the Chinese Ethereum since it was launched in 2016 to rival Ethereum. NEO is also the first open-source blockchain network developed in the East Asian country. On the other hand, the smallest fraction (1) of NEO can be staked. And you can earn GAS, a cryptocurrency that is given as a reward for staking NEO. To stake NEO, you need to install a NEO-compatible wallet, buy NEO, and install the Neon wallet to receive GAS.
2. Dash (DASH):
Dash is a fork of Bitcoin launched in 2014, and it is one of the first cryptocurrencies to adopt a PoS mechanism. It is worth noting that Dash is accepted for goods and services in several online and offline platforms worldwide. That aside, you can run a master node and earn dividends as a Dash holder. In this case, you will need a minimum of 1000 DASH as collateral to run a master node and expect a yield of 7.01%.
3. Vechain (VET):
Vechain works by enabling smart transactions, and it has gained adoption in the Pharmaceutical industry where it is used to provide Drug and Vaccine Traceability Solutions. On the contrary, VeChain relies on a Proof of Authority Consensus Model, an improvement on Proof of Stake. It also has two coins called Vechain (VET) and VeThor (VTHO). You receive VTHO as a reward for staking VET. To begin, you need to install the Atomic wallet, send VET to your wallet, and wait for VTHO to be distributed.
4. Lisk (LSK):
Lisk relies on a dPoS protocol, and as such, you can stake your coins offline, which enables you to vote for List delegates. Rewards are earned by the top 101 delegates who can forge blocks, and their reward is shared amongst their voters. That being the case, you need at least 4 LSK to begin staking. You can also stake your Lisk using the Lisk Nano wallet.
5. Tezos (XTZ):
Tezos is an open-source blockchain platform for developing dApps, and it supports smart contracts. It uses digital currency XTZ, which is issued through the process of baking. On Tezos, validators called bakers to earn more XTZ by donating their coins to the network. On the other hand, each block baked is validated, and if a breach in the protocol is discovered, a baker can lose their funds. To begin, you need to buy Tezos from an exchange and start staking them to earn 85% of staking rewards.
6. Navcoin (NAV):
Navcoin is an open-source blockchain platform that prioritizes privacy; hence, it is a privacy-based cryptocurrency. Navcoin was launched in 2014 as Summercoin, and it is one of the first crypto assets to adopt the PoS model, and it has no limitation for the minimum number of coins that can be used to stake. However, the higher the staked coins, the higher the rewards earned.
Best Wallets to Stake PoS Coins
The best wallets to stake PoS cryptocurrencies are:
1. Atomic Wallet:
The Atomic wallet supports a range of cryptocurrencies, and it can be used to stake a variety of staking coins, including Tezos, Neo, and VeChain. All you have to do is hold the coin in this wallet to receive your income.
2. Cobo Wallet:
Cobo wallet also offers support for Dash, Lightning Bitcoin (LBTC), Zcoin (XZC), and other staking coins. In this case, you will have to delegate from cryptocurrency to the Cobo node, and then stake your cryptocurrencies from the Cobo wallet.
3. Trust Wallet:
Trust wallet allows you to stake cryptocurrencies, including Vechain, Tezos, and Cosmos. You can run it from an Android or iOS smartphone for more convenience and easy accessibility to your funds.
The cryptocurrencies outlined above are some of the best proof of stake (PoS) coins to invest in 2020. You can earn rewards while being a loyal holder of an asset. Similarly, you can stake these coins from some of the best staking wallets for PoS coins.