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Cardano Staking

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FAQS

Cardano staking refers to the process of holding and delegating ADA to a stake pool. This group of validators work together to process transactions and create new blocks on the Cardano network.
Staking is an essential part of the Cardano blockchain's consensus mechanism called Proof-of-Stake (PoS). Instead of using computational power (as in Proof-of-Work), network participants use their ADA holdings to participate in block validation and earn rewards for their contribution.
By staking their ADA, users not only help secure the network but also receive a portion of the transaction fees generated by the blocks they validate. For more information, please visit https://cardano.org/stake-pool-operation#what-is-staking

Saturation is a term used to indicate that a particular stake pool has more stake delegated to it than is ideal for the network. The parameter ‘k’ indicates the desired number of stake pools. Once a pool reaches the point of saturation, it will offer diminishing rewards. The saturation mechanism was designed to prevent centralization by encouraging delegators to delegate to different stake pools, and to incentivize operators to set up alternative pools so that they can continue earning maximum rewards.
Cardano’s Ouroboros protocol uses randomness to determine when a pool mints a block. Each ADA functions almost as a lottery ticket, where the more ADA delegated, the greater probability of minting a block. Luck refers to the number of blocks minted compared to the number of expected blocks.

After delegating to a stake pool, it takes 2 epochs for your delegation to become active. After this initial period, you will earn rewards after each epoch, as long as your pool mints a block.

ADA rewards are paid based on your delegation amount and stake pool performance. For a rewards calculator, visit https://cardano.org/calculator/?calculator=delegator

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