Staking is the process of committing your tokens to the Cardano and other proof-of-stake blockchain for the purposes of validating transactions on that blockchain. Individual token holders pledge (i.e., “stake”) their tokens directly to the blockchain, as a form of escrow of security deposit - though more commonly, individuals delegate their tokens to a stakepool, which aggregates pledged tokens from a large number of individuals into a single pool of tokens. In doing so, these “stakepool operators” are better able to compete for the right to validate future transactions and earn rewards for such effort. Those stakepools with the largest number of pledged tokens have the highest chances of being chosen as validators, and thus of receiving staking rewards from the blockchain l. Those rewards are then distributed among the winning stakers (who in turn share some of the reward with each of the individuals who delegated their tokens to the stakepool).

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