PIVX Staking, What Is It?

PIVX Core Wallet 5.3 is out, and staking is in full swing! So, to answer the two most oft-asked questions regarding staking “when and how much,” have a read.

With PIVX back in the staking game, we thought it would be a great time to discuss what staking is, isn’t, and why it’s so important.

Before that, however, let’s quickly roll back the clock and touch on why the team put a pause (“Maintenance Mode”) on staking, or rather, cold staking, for a bit. In February 2021, the security-conscious decision was made to halt staking* after an issue in some code was found. While I’m not certain what was found, it was profound enough to flip the off switch. [*cold staking]

Back to the present. Over the weekend, our developers released version 5.3 of the PIVX Core Wallet, which continues full-on cold staking (and a few other goodies). You’ll notice that I’ve mention cold staking and not just staking.

PIVX enables both hot wallet staking and cold staking.

Staking

Hot Wallet Staking

Within the realm of PIVX, staking via your hot wallet can be easily explained as staking your coins in a wallet that’s running on a computer 24/7. My #dadjoke on this would be “it’s called hot staking because your computer is hot from running so long.”

While the joke is a joke, it’s the truth. To use hot staking, you’d have to have a computer running the core wallet always on to ensure you’re rewarded. This can be an issue for some. Either they don’t have the resources, know-how, or either/both.

It’s great that you can run a wallet on a computer such as a Raspberry Pi; however, sometimes limitations prevent us from doing so. For instance, I live in a tropical paradise, with less than desirable/reliable internet.

Cold Staking

If you think about everything that staking via a hot wallet is and turn it upside down, you have cold staking(ish). I personally prefer this method of staking as I don’t have to worry about anything necessarily. Here’s the Cold Staking page on PIVX.org for some graphics and easy-to-understand language and how-to.

Short Version: The act of cold staking is when you delegate your PIV to someone else’s care/machine via your core wallet and still reap the rewards.

Longer Version: When you cold stake, you delegate- not give- your PIV (funds) to someone or a service that runs a computer 24/7, so you and I don’t have to.

Some of these services charge you a flat fee or a reward percentage to cold stake on their service. However, none of the three services I’ve tried charge any for PIVX cold staking (they get their own rewards).

It really is a case of stake it and forget it. After you delegate, you honestly don’t have to do anything. Just wait for the rewards. Wait, rewards?

Staking Rewards and Coin Distribution

As a Proof of Stake consensus cryptocurrency, the pure nature of security ensures you’re rewarded for participating in said security. I’m not going to dive deep here; however, if you’re into the subject at hand, PIVX has a great Economic Whitepaper you might want to check out. That said, let’s break this down into the easy-peasy.

Every 60 seconds, a new block on the PIVX blockchain is created, and with it, five (5) new PIV. The formula is built into the protocol. Each of those PIV is distributed as such:

• 3 are given to a masternode owner,
• 2 are given to the staker that wrote the block, and
• 1 is placed/allocated to the monthly Treasury Budget that may be created at the next 30-day Super Block.

However, do note that the distribution of cold staking rewards is distributed randomly for security. Therefore, a question often asked is, “when will I get my rewards.” Unfortunately, the answer is always going to be “we/I don’t know.” However, you can get an idea of your reward expectation via the handy calculator on PIVX.org. Also note, that the return works out to be about 9%. 🙌

Here’s the reality of it, sometimes you may get a reward once a week for a few months, and then it’ll change up to none for a few weeks, then you’ll get them back to back for a few days. Then, next thing you know, you’re staking rewards are seemingly on a schedule again, or not. But in truth, it’s all random. It’s by design; worry not, you’ll get them.

On a side note, if you’re interested in helping push PIVX forward or want to learn more about the Budget Proposal system, where the project uses the funds allocated to the treasury (43,000 PIV monthly), check out this page.