Ethereum and Crypto Staking: A Few Things To Know
Ric Edelman: Welcome back to The Truth About Your Future with Ric Edelman. Great to have you with me this weekend. We've got a question here on The Truth About Your Future. John from Glendale, California, sent in his question. Let's listen.
ASK RIC: John - Glendale, CA: Hi, Ric. Longtime fan of your show. I just started working my way through your new book, The Truth About Crypto. And I also just recently made my first purchase of Ethereum. When I made that purchase, I was offered to stake my Ethereum at 3.675 APR. I've done some research on staking, but I wanted to ask what your view was on staking and if you could give a clearer explanation of what it is. Thank you for taking my question and I look forward to listening to your answer.
Ric Edelman: Well, John, I'm glad you've jumped down the rabbit hole into crypto. And yeah, staking is a very common way that people deal with their crypto investments. It's a way for you to post your coins onto the blockchain, which helps develop and grow the blockchain, and in exchange you earn interest. You quoted nearly 4% annual return. So it's a way that you can increase your profit by investing in crypto. You need to recognize there are a lot of details regarding staking. It takes a little more time than we can delve into here on the show. I cover it in my book, The Truth about Crypto, which you said you're already reading. The bottom line is this staking is one of the ways that data gets placed onto the blockchain and is cryptographically authenticated. And for the act of engaging in staking, you get rewarded economically for participating. There are risks associated with this. You need to make sure you understand how staking works. You need to make sure you're engaging in staking with a reputable platform. But a lot of folks are using this as a way to increase their investment profits when investing in crypto. So I encourage you to continue learning more before you decide to engage. And if you'd like to learn more about staking, I encourage you to read my book, just like John is doing, The Truth About Crypto. And if you've got a question, you can do what John did. Record your voice on your smartphone and send me the audio file to AskRic@thetruthayf.com.