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Staking Market Growth and Dangers

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Source: iStock/asbe
Proof of Stake has become fashionable. Towards the tail end of 2019, a growing number of crypto-exchanges and platforms added support for proof-of-stake (PoS) tokens, as well as for staking services that invest PoS crypto on the behalf of users.
At the same time, the number of proof-of-stake digital assets grew, as did the amount of value staked in them.
[img]blob:https://altcoinn.com/dc4c2c62-5571-4ea9-92ea-df715cda160e[/img]
Source: stakingrewards.com
Such growth is set to continue in 2020, with analysts expecting more PoS projects to come online in the new year. Not only that, but they expect the market for staking services to expand, in terms of the amount staked in PoS cryptocurrencies and also the number of staking services being made available.
Proof of growth
“Given the wide variety of Proof of Stake blockchain projects coming to market in 2019/2020 and the burgeoning related infrastructure, it is reasonable to expect the overall market for staking and related services to grow,” explains Stuart Young, a researcher at blockchain analytics firm Smith + Crown. “Live networks that are part of this trend include both layer 1 networks such as Tezos, Decred, Cosmos, and Algorand, as well as applications such as Livepeer.”
Tezos and other PoS coins mentioned are already live, but a number of PoS launches are due for this year. Also, the market is waiting when Ethereum will complete its much-anticipated switch to a proof-of-stake consensus mechanism, while Cardano and Tron will also be switching to new PoS mechanisms.
Also speaking to Cryptonews.comBitGo‘s CTO Ben Chan is another expert that expects the staking market to grow, although only if two conditions are met.
The first condition is the success of the Ethereum 2.0 rollout. “Here, there are 2 considerations – whether or not ETH 1.0 holders will convert to ETH 2.0 during phase 0, and how long it takes to get ETH 2.0 to be operational,” he explains.
On top of this, Chan also highlights the ability of alternative layer 1 PoS platforms to gain adoption and maintain market cap.
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