Today, we’ll have a look at why we’re building a staking pool. A staking pool for Cardano is, instead of the proof of work, we have what we call a proof of stake. Now, proof of work is where you get to solve all these hugely computational intense programs but requires a massive amount of energy. So that drives more modern blockchain technology to use what’s called a proof of stake.
Proof of stake allows these complex computations to execute in split seconds instead of hours and hours of computation that requires massive amount of electricity. So these are environmentally responsible blockchain technology that allows us to still do the same thing. These have been verified and proved in many different technologies, including Ethereum that’s been trying to get moved to this, although it hasn’t got there yet. And here are 4 reasons Cardano Ada is better than Ethereum!
In order for the proof of stake to work, there has to be staking pools. So, different than mining, it is the staking pools that verify the blockchain for these proof of stake technologies. And as part of the project, we want to build a Cardano staking pool. The ability to build the staking pool ultimately allows us to then work on the network of computers that performs the transactions, which allows the blockchain to continue functioning. One of the first reasons we do this is to simply give back and help the network, and ultimately become a part of it.
Secondly, while our transactions are going to be processing, we can then build our own staking pool’s reputation. This will allow us to create a fractional, very minuscule profit from these gas fees. And then we’ll raise the reputation of our staking pool, which will hopefully draw more people to our staking pool.
The third reason we’re building our own staking pool is that it will allow us to keep that staking pool networkly close to the actual transactions that we’re performing as part of the technology stack we’re building. So this can actually process the charges even faster. So part of our goal is how we can process these transactions faster, and by having the staking pool nearby, it will allow us to keep those transaction charges low, which allows us to overall keep our overhead low, and then also allows the transactional times to stay low.
Ultimately, this is a great opportunity for people to build passive income on Ada even if you’re not going to be building on the technology. It’s a great way to take the Ada that you already have, stake it using the staking pool, and then allow others to perform transactions against it. This ultimately lets you collect some of the gas charges that are incurred as part of the normal transactions with Ada.
Thank you for sticking with me to the end. That explains everything about why we’re building a Cardano staking pool of our own. I hope this valuable information helps you in your journey with Cardano. And as always, make sure to keep your kids protected with CleanRouter and CleanPhone so that you have the ultimate parental controls with how your kids use their phone 🙂
If you’d like to learn more about the same, kindly check out this video: