#SoftStaking
When you participate in soft staking, platforms like Binance or other supporting exchanges will stake your eligible coins on your behalf with the network. You typically only need to activate the soft staking feature once. The platform then takes daily snapshots of your wallet and calculates rewards based on the balance and the annual percentage yield (APY). Rewards are usually paid out daily or weekly, depending on the platform and the token.
Benefits of soft staking :
Passive income: Earn rewards by simply holding your tokens, generating income without active trading.
Flexibility and liquidity: Access your funds anytime, allowing you to seize trading opportunities or manage market volatility.
Simplicity:
Easy to activate and use, even for beginners, as the exchange handles the technical complexities.
Lower risk (compared to traditional staking): Many of the risks associated with traditional staking, such as slashing (penalties for validator downtime) and illiquidity, are reduced or eliminated with soft staking. However, platform risk (e.g., hacks, mismanagement of funds) is still a factor with centralized exchanges.
