Soft staking is a staking method in the cryptocurrency world where the coins or tokens being staked are not locked and can still be traded or used for other activities, while still earning staking rewards. This is different from hard staking, which requires coins to be locked for a certain period.
Further Explanation:
Soft Staking:
In soft staking, the cryptocurrency assets you deposit are not locked in the network but remain in your account (for example, on a cryptocurrency exchange or network node) and you can still trade them or use them for other purposes while still earning staking rewards.
Hard Staking:
In contrast, in hard staking, the cryptocurrency assets you deposit are locked in the network for a certain period and cannot be traded or used for other purposes during that time.
Advantages of Soft Staking:
The main advantage of soft staking is flexibility. You can continue to utilize your assets for various purposes while still earning rewards from staking, allowing you to adapt to market changes.
Example:
Platforms like CEX.IO offer soft staking features where users can stake their assets and still be able to trade them.
Soft Lockup:
Some platforms, such as Crypto.com, also offer "soft lockup" similar to soft staking, where users earn rewards by holding balances in their accounts without locking them for a specified period.
Thus, soft staking provides a solution for those who want to benefit from staking without having to sacrifice the flexibility of their assets.
