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Cryptocurrency

What is stacking and how to earn on it?

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Stacking is a way of earning passive income from cryptocurrencies based on the Proof-of-Stake (PoS) consensus algorithm and its variants.

The essence of Stacking is to block a certain amount of coins in a wallet to get the right to participate directly or through intermediaries in the maintenance of the blockchain of a given asset and receive compensation for it. Stacking has a similar role in PoS-blockchains as mining in the bitcoin network.

Stacking appears to be a profitable alternative to simply holding cryptocurrencies in a wallet, being analogous to a bank deposit in the crypto industry. Stacking returns vary depending on the blockchain and can be as high as tens of percent per annum or higher.

What is Proof-of-Stake (PoS) and how does it relate to stacking?

Proof-of-Stake is a consensus mechanism in which the right to generate new blocks, verify transactions, and include them in the blockchain according to a certain algorithm is played out between computing nodes based on how much of a given blockchain’s coins they own.

In a basic scenario, a node that owns 1% of all coins in circulation receives the right to process 1% of the blocks, and for its work it receives 1% of all rewards of the network. However, many cryptocurrencies also consider the tenure of coins and other factors. Stacking is getting the very reward for producing new blocks and verifying data with its share (native coins).

How does stacking work in Proof-of-Stake?

In “classic” PoS cryptocurrencies, each official wallet acts as a full node, meaning it verifies and validates transactions and produces new blocks.

Technical requirements differ from one blockchain to another: some networks only need a home computer to deploy and manage a node, while others require professional server hardware. In this way, the blockchain is decentralized and secure without the huge energy costs inherent in Proof-of-Work consensus cryptocurrencies.

The terms of participation in stacking may vary. The general mechanism is to buy the native coin you want to participate in stacking and send it to a smart contract yourself (e.g., through a wallet) or pass it to a validator.

Depending on the speed of coin issuance, stacking yields can reach tens or hundreds of percent. At the same time, it is a way of issuing cryptocurrencies, so too high a rate of reward can lead to coin inflation, which will have a negative impact on profits.

Who are the stacking providers?

Stacking is a popular strategy for investing in digital assets. However, setting up a node or stacking in an individual crypto project can be quite time-consuming. 

Therefore, special platforms that provide all-in-one stacking services have become widespread in the cryptocurrency market. They are applications where users can simply send their funds to various pools via the provider’s wallet.

Stacking providers also analyze the current profitability of stacking in the selected network and show other necessary data. Stacking platforms make it as easy as possible for users by charging a small commission on the compensation they receive.

What are the risks of stacking cryptocurrencies?

Stacking appears to be a profitable and relatively safe alternative to simply storing cryptocurrencies in a wallet, promising returns that can be substantial. However, there are a lot of risks that can significantly reduce expected returns and even lead to losses:

  • Since stacking participants earn income in coins of a given cryptocurrency, fluctuations in its exchange rate affect the value of invested funds and the actual stacking returns;
  • The high stacking yield offered by some PoS-cryptocurrencies (tens and hundreds of percent annually) is achieved due to the high speed of coin issuance. This often leads to a rapid drop in the market price of the coin and a rapid depreciation of the investment in this cryptocurrency;
  • Requirements for stackers may include blocking of coins for a period ranging from several days to several months. During this period, the owner cannot withdraw and sell their coins;
  • stacking cryptocurrencies using stacking providers carries all the risks associated with trusting a third party, which may be subject to a hacker attack or misappropriate assets collected from stackers.

Cryptocurrency

Ethereum Foundation, Whales, and Hackers: What’s Driving the ETH Sell-Off?

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TL;DR

  • Whales, hackers, and the Ethereum Foundation wallets moved over $500M in ETH through large sales and withdrawals.
  • Ethereum transfers rose to 4.6M ETH, nearing the monthly high of 5.2M recorded in July.
  • Staking inflows hit 247,900 ETH, the highest in a month, locking more supply from trading.

Large Withdrawals and Whale Activity

Ethereum (ETH) has seen heavy movement from major wallets over the past few days. On-chain data from Lookonchain shows a newly created wallet pulled 17,591 ETH, worth $81.62 million, from Kraken in just two hours. 

Over three days, two new wallets withdrew a combined 71,025 ETH, valued at $330 million, from the exchange.

One of these wallets, address 0x2A92, has withdrawn 53,434 ETH, worth $242.34 million, in two days. This includes a recent purchase of 30,069 ETH, valued at $138.46 million, during a market drop.

Major ETH Holders Offload Millions Amid Price Rally

In contrast, several separate entities have been disposing of some ETH holdings. A wallet tied to a hacker address 0x17E0 sold 4,958 ETH for $22.13 million at $4,463, securing a profit of $9.75 million. Earlier this year, the same address sold 12,282 ETH at $1,932 and later bought back part of the amount at higher prices.

A different whale sold 20,600 ETH for $96.55 million over the past two days, generating a profit of more than $26 million after holding the position for nine months. 

Meanwhile, an Ethereum Foundation-linked wallet, 0xF39d, sold 6,194 ETH worth $28.36 million in the last three days at an average price of $4,578. 

Recent sales from the same wallet included an additional 1,100 ETH and 1,695 ETH for over $12.7 million combined.

Network Activity on the Rise

CryptoQuant data shows Ethereum’s total tokens transferred have been climbing since August 9. After ranging between 1 million and 3 million ETH through late July and early August, transfers have risen to 4.6 million ETH, approaching the monthly high of 5.2 million recorded in mid-July. This increase has occurred alongside a price rally from about $3,400 to $4,600.

Ethereum (ETH) Tokens Transferred (Total)
Source: CryptoQuant

Interestingly, staking inflows generally stayed between 20,000 and 80,000 ETH per day over the past month. On August 14, inflows jumped to 247,900 ETH, the highest in the period. 

At the time, ETH was trading near $4,600. Large staking deposits reduce the amount of ETH available for immediate trading, as staked coins are locked for a set period.

Ethereum (ETH) Staking Inflow Total
Source: CryptoQuant

In the meantime, ETH trades at $4,647 with a 24-hour volume of $68.25 billion, down 2% on the day but up 19% over the week.

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Cryptocurrency

Massive DOGE Whale Activity Hints at $1 Breakout

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TL;DR

  • Whales bought two billion DOGE this week, lifting their combined holdings to 27.6 billion coins.
  • A single 900M DOGE transfer worth $208M to Binance drew attention to large exchange movements.
  • DOGE broke key resistance, with momentum building for a possible push toward the $1 price mark.

Price and Market Moves

Dogecoin (DOGE) traded at $0.23 at press time, slipping 4% over the past day but still showing a 2% gain for the week. Daily turnover came in at about $6.18 billion. 

Meanwhile, the broader crypto market saw over $1 billion in liquidations. Hotter-than-expected US Producer Price Index data pushed traders to scale back expectations of a near-term Federal Reserve rate cut. DOGE had roughly 290,500 coins liquidated during the sell-off.

On the two-week chart, analyst Trader Tardigrade notes that DOGE has cleared a downward-sloping resistance line after completing what appears to be a “wave V” in an Elliott Wave sequence. Similar setups in the past, where prolonged declines stayed within falling channels before breaking higher, have been followed by sharp rallies.

Momentum gauges are also turning up. The Stochastic RSI, which had dropped into oversold territory, is now heading higher. Previous reversals from this zone have coincided with sustained upward moves. The current formation points to a possible run that could carry DOGE past the $1 mark.

Heavy Whale Buying and Large Transfers

As reported by CryptoPotato, blockchain data shows large investors have added two billion DOGE in the past week, spending just under $500 million. That brings their holdings to about 27.6 billion coins, or 18% of the supply. The buying streak has prompted speculation within the community. 

Recently, Whale Alert flagged a 900 million DOGE transfer worth about $208 million into Binance. The tracking indicates that it originated from a wallet connected to the exchange, likely as an internal activity. The address involved holds 2.88 billion DOGE, one of the largest balances on the network.

Ali Martinez also reports that transactions above $1 million reached a one-month high, with activity building since early August and peaking as DOGE traded at $0.25.

Sentiment Building

Analyst Gordon described the current setup as “a nice bit of consolidation” before a potential breakout, adding, 

“This will be one of the first coins normies FLOCK to & the pump will be MASSIVE.”

With whale accumulation rising, high-value transfers increasing, and a bullish technical pattern in play, DOGE is positioned for a potential push toward $1 if momentum holds.

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Cryptocurrency

Ripple Price Analysis: XRP at Risk as Key Support Levels Could Trigger Sharp Drop

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XRP has recently entered a consolidation phase after a strong rally earlier this summer, with the price action now hovering around key resistance levels on both its USDT and BTC pairs. Yet, while momentum has slowed, the charts still indicate a generally bullish structure, with multiple key support levels remaining firmly in place.

Technical Analysis

By ShayanMarkets

The USDT Pair

On the XRP/USDT daily chart, the price is currently trading near the $3.10 mark, facing a strong resistance zone around $3.40. This follows a breakout above the $2.70 range in July, which has now flipped into a support area.

Both the 100-day and 200-day moving averages are also trending upward and recently formed a bullish crossover around $2.45, reinforcing the medium-term bullish sentiment. If the $3.40 resistance breaks, a push toward the critical $4.00 range becomes likely.

However, the RSI hovering near the neutral 50 level suggests a lack of strong momentum for now, meaning a short-term pullback into the $2.80 support zone is still possible.

This zone will be key for maintaining the bullish structure. Losing it could open the door for a deeper correction toward the 200-day moving average located around the $2.40 mark. Yet, as long as the price stays above the moving averages, the broader trend remains bullish.

The BTC Pair

Looking at the XRP/BTC chart, the pair has recently pulled back after hitting the 3,000 SAT resistance, with the price currently around 2,600 SAT.

This follows a clean breakout above the long-term descending channel and a successful retest of its upper boundary, which coincided with the 200-day moving average and the 2,400 SAT support zone. This confluence remains a key bullish technical factor, as holding above it could attract renewed buying pressure.

That said, RSI levels around 48 show that momentum has cooled after the sharp July rally, meaning XRP may continue ranging between 2,400 SAT and 3,000 SAT in the near term. A decisive close above 3,000 SAT would likely open the path to the 3,400 SAT zone, while losing 2,400 SAT could shift the bias back toward 2,000 SAT support. For now, the structure still favors the bulls as long as higher lows remain intact.

 

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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

Cryptocurrency charts by TradingView.

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