Ethereum (ETH) 2.0 Upgrade could spark a new wave of enthusiasm if it continues to replace mining in 2020. Tezos “Baking” grows on wider coin adoption.
02 December, 2019 | AtoZ Markets – Staking coins may become fashionable again, as passive income and slow growth replace the highly speculative uses that existed before. Staking is not new in the crypto space, but this time there is better infrastructure and more reliable projects.
Ethereum (ETH) 2.0 Upgrade 2020
The forecast for 2020 comes from Alex Kruger and takes into account the staking success of Tezos (XTZ) so far. The Tezos project provides reliable governance in the “bakery” process, and Coinbase’s custodial services also offer a more reliable source of passive XTZ.
Instead of a wide range of staking coins, as in the past, the practice of passive income can be attracted by the most liquid altcoins. Those manage to maintain relatively stable prices.
Passive Income is not a "meme".— Alex Krüger (@krugermacro) November 30, 2019
This is how interest in passive income looks like. Do you see the trend? pic.twitter.com/AGtJmhGVAO
ETH 2.0 is the promised staking mechanism. It will expand ETH’s coin storage culture. Currently, ETH’s passive income is available for programs such as Maker, Compound, and Binance’s exchange-based return programs.
As ETH remains relatively stable, the new utility of the coin is a passive income source. Also, staking means at least some selling pressure since the rewards are monetized.
For Ethereum, staking can replace the lowering of mining concessions, because the time bomb of difficulty still affects the network. But the ETH is not the only coin to test staking. Other projects are turning to the passive income offering, including the LINK, which has seen a recent boom.
Annual Passive Revenues of Tezos
Currently, Tezos offers one of the highest annual passive revenues, at 6.21%, but combined with some inflation based on XTZ’s growing supply. Cosmos (ATOM) has an annualized profit of 8.52%. There are also coins offering extremely high annualized revenues, like Livepeer at 78.6%. The LTP, however, is extremely volatile and has lost 60% of its value since August.
ETH staking parameters are not yet clear, ranging from the staking of some ETH to thousands of coins. For now, we do not yet know what the rewards would be, but the annualized returns will be relatively low.
Bitcoin mining (BTC) remains a high-stakes activity with a large barrier to entry. However, staking may be a less expensive mechanism for scaling up. The only uncertainty of staking is access to real assets. Some coins may be considered securities depending on the supply of passive income in the form of a dividend.
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