Block explorer that brought out a new, refreshing concept to visualize transactions.
Fundamentally, Cardano works like any other cryptocurrency staking system. By holding and staking its tokens, you will assist the network with validating blocks on the protocol and receive a return on your investment. However, Cardano does not allow solo staking. Instead, you can either opt to run a staking pool that other participants can join, or delegate your holdings to someone else’s pool. The reason for this is to ensure that there are enough node operators within the network.
Cardano also allows support stakes to maintain separate keys for spending and staking. If you have opted to delegate your tokens rather than run a staking pool, you can do so without your holdings ever leaving your wallet. In addition, Cardano does not enforce any time periods for tokens to be locked up, so you are free to unstake and restake them whenever you wish.
Decentralisation is maintained through safeguards which prevent individual staking pools from gaining too much power. This is done by diminishing returns relative to pool size which should incentivise users to move between pools regularly in order to maximise their rewards. There will even be a comparison tool available to help people find the most profitable pools in order to make this process even easier. Staking pools also do not have the ability to vote on changes to the protocol, further reducing the chance of centralisation occurring.