Risks of Staking Mining Validator/Node Operator Risk Generally speaking, node operators will raise funds through smart contracts . If special circumstances are excluded, the principal will not be a problem, but this does not mean that the client does not need to be a node operator If you work hard, there are still risks associated with node merchants. .This article is organized and published by qkljys123. The node business is not only stealing the client's money, but making a negative contribution to the consensus of the whole network, for example: the node does not participate in the network consensus for a long time and misses a few blocks, double signature Disrupting the network consensus or other behaviors that do not comply with the consensus regulations may result in the system confiscation of some of the mortgaged assets, which may also lead to the loss of the delegator, such as the two projects of Cosmos or IRISnet, both the validator and its delegator will be It is directly punished, so the client must choose the node business carefully. In addition, although the pledged tokens will be locked in the smart contract, the block reward will not, and most delegators will not regularly calculate the interest they get. Is it compared to the rate of return announced by the node operator? Therefore, some Bad node merchants will give less reward to the client, which is the so-called "eat money". Token Price Volatility Possibly the most dangerous risk of staking is price volatility. If the market is in a state of collapse, even if you may have obtained a considerable amount of staking rewards, it is still possible that the final income will become a deficit due to the decline of the token price. Therefore, it is important for the principal to clearly understand that cryptocurrencies are highly volatile products that carry considerable risks. If you want to reduce the risk of PoS pledge mining, if you want to reduce the risk of token price fluctuations, one of the solutions is to hedge and lock the currency price through margin trading. But the most important thing is to choose a blockchain project with real technology and community agreement, not the marketing products that seem to pay the most rewards, and different projects have different rules, and the delegator must be familiar with these pledges when choosing Rules, such as Cosmos pledge mining, if you want to redeem, you must wait for 21 days to be credited. These are the rules that delegators need to understand. What does staking mining mean? We explain with a simple little story. Aping is an engineer who understands the blockchain and thinks that the Cosmos project is very developing. He thinks that the Cosmos tokens in the wallet are stored anyway. Why don't I get a node and earn a little block every month? Therefore, Aping set up a Cosmos validator/node and started mining. He found that the amount of Cosmos he held was too small, and the mining reward was not as expected, but he had no money to buy more. Multi-currency, what to do with this. A Ping thought about it, picked up the phone and called A Cai and A You, long-term investors in Cosmos, and said to them: "Hey, I am now a node of Cosmos, and you keep your coins as they are. Do you want to? Just leave me here, the block reward will be divided proportionally, I just need to take a small fee." A Cai agreed without thinking, but A You frowned and asked A Ping: "No, I Give you the coins, if you take all the coins, what will I do." Is DeFi staking mining risky?
Validator/node business risk
Token price fluctuations As we all know, pledge mining has certain risks. If you want to reduce the risk of pledge mining, in addition to carefully selecting projects and node business, you must learn not to Eggs are placed in the same basket. Choosing different node providers for the same project can avoid losses caused by malicious node behavior. Choosing different projects can also avoid losses caused by the volatility of a single currency price. In addition, the editor wants to remind investors. The thing is, in the entire market, 10% of people are always making money, and 90% of people are losing money, so even if you choose to pledge mining, it does not mean that you will be able to make money. .