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Required Legal Notice: Virtual currencies, real risks. The only guarantee in crypto is risk. Warning: The value of your virtual currencies can rise or fall sharply, and your initial investment may be lost completely; virtual currencies are not covered by the guarantee funds that cover bank deposits; there is no legal mechanism on the virtual currencies market to prevent market manipulation or insider dealing; virtual currencies depend entirely on a specific computer technology and infrastructure, which in certain cases may be very recent and not yet adequately tested; if one loses the identification code or password giving access to the virtual wallet in which the virtual currency is stored, the currency held therein will be irretrievably lost; virtual currencies are currently accepted as a means of payment to a limited extent, and in most countries there is no legal obligation to accept them; for more information about the risks associated with an investment in virtual currencies, we advise you to read the Wikifin page What is a cryptocurrency? | Wikifin.

What is a Proof-of-Stake protocol?

Last updated: 9 жніўня 2025 г.

Networks such as Bitcoin function because they have miners who are willing to leverage their computing power to process transactions and safeguard the blockchain. This process is known as Proof-of-Work (POW).

Many newer blockchains utilize a different form of achieving consensus, known as Proof-of-Stake (POS), to process transactions. POS is a much less energy-intensive process.

It works like this:

Instead of high-powered nodes processing transactions in exchange for compensation, clients on the POS blockchain or network post a percentage of their crypto holdings as a form of ‘collateral’ to achieve the same result.

Clients who ‘stake’ their crypto holdings on a POS network can earn additional assets as a reward for doing so.

Assets listed on Kraken that currently utilize a POS protocol include but are not limited to Tezos, Cosmos, Cardano and EOS.

Related support articles:

Onchain staking

How to stake

What is a Proof-of-Stake protocol?

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