![banner.jpg](https://images.ecency.com/DQmQup87znc57eLqGsTUfsy1Za2ygndXiS1Mgibb8UftzMf/banner.jpg)


## Recap of how traditional staking in POS Blockchains works 

The latest Dexs and Blockchains have started adding utility to otherwise staked tokens that crypto holders stake to receive staking rewards in Proof of Stake(POS) Blockchains. 

### Validators get block rewards for validating Blocks in Blockchain

As most of us know, POS Blockchains function with validators who have to stake a minimum amount of the native tokens of the Blockchain to be able to kick start their validator functions that secure the network. Validators receive rewards when they validate a block getting Block rewards.

### Staking rewards for crypto holders who delegate their staked crypto to validators

Now, it’s very commonplace that crypto holders delegate their crypto to the validator of their choice, in return for this they get staking rewards where a portion of the rewards that validators get will be distributed to delegators. POS Blockchains like Cosmos, Solana all function this way.
![cosmoshub.jpg](https://images.ecency.com/DQmQjWENoutr5paiyZ73zqigtWoLhKLviiwuRZ1ShjYwom1/cosmoshub.jpg)
*Staking the traditional way can be done on Cosmos on the keplr wallet*

 
 
## Protocol Governance Rights for delegators

Delegators also get  to participate in Governance voting, where they can vote on protocol proposals, with them having a hand in managing the course of the protocol with their decisive voting power.
 
![governance.jpg](https://images.ecency.com/DQmR6VwndYxjmvjhPGFPSsZ9qF4WQwXFCgGhCcYKiiFUp4p/governance.jpg)



*Holders who stake their tokens in the Cosmos Blockchain are eligible to vote on the Blockchain's Governance proposals*


## Current Limitations of the traditional POS staking mechanisms

Now, things are evolving in the staking arena, as is visible with new Defi protocols Crescent and Shade built in the Cosmos network.

### Staked cryptos are locked and not available to be used in Defi
Earlier with traditional staking, crypto holders stake their tokens and earn staking rewards, but this is locked capital which is stagnant and cannot be used as an asset in Defi protocols. 

### Not possible to unstake and liquidate staked cryptos immediately
The staked tokens plus accrued staking rewards can be availed when unstaked, but its subject to the protocol’s or Blockchain’s unbonding period which is 21 days for Cosmos. So, there is always a necessary delay when one wants to liquidate and avail the staked cryptos.

## New Age staking mechanisms for POS powered Dapps

Let’s see how staking mechanisms have evolved in [Crescent protocol](https://app.crescent.network/) which launched very recently on April 14th. 

The new way of delegating tokens to validators here is called liquid staking. Here, the staked assets are a little flexible and not too rigid as it is in  the case of traditional staking.

### Easy to stake CRE by just converting it to bCRE

The native tokens of the Crescent protocol is CRE. In liquid staking, CRE is converted to bCRE which represents staked CRE which will be equally distributed to white listed liquid staking validators of the Crescent protocol’s liquid staking module.

![lqstake.jpg](https://images.ecency.com/DQmZAumu42udhs63zkht9oWokwJM86rsQwgtpVo3NdHGDbU/lqstake.jpg)
*Stake bCRE by just converting CRE tokens to bCre in Crescent Defi*

 This bCRE can be used in Crescent Defi so it's quite liquid that way.
 
 
## bCRE is a very liquid asset in the Crescent protocol

There are various liquidity pools for bCRE, where bCRE represents liquid staked CRE plus accured staking rewards. 

As you can see, there are various liquidity pool pairs for bCRE like bCRE-CRE, bCRE-Atom, bCRE-Luna, bCRE-UST and currently Liquidity providers(LP) of these pairs earn CRE  farming rewards apart from the usual swap fee rewards that LPs get. 

![farming1.jpg](https://images.ecency.com/DQmahUfS51fL42i2g6dERdqtd2VyEYMc2VLtvJWd2TXG4WN/farming1.jpg)
[Crescent Defi](https://app.crescent.network/)



Now with liquidity provided for these bCRE pairs, swapping between these pairs is made possible.

### Easy to sell bCRE for UST or CRE without unstaking

Since, bCRE can be swapped for CRE or UST directly, holders have a way of liquidating bCRE  instantly. The usual way of unstaking bCRE will delay the availment of CRE along with the accrued staking rewards as they are subject to the protocol’s unbonding period of 14 days.  

Since bCRE can be swaped to UST directly, it is not necessary to convert bCRE to CRE for selling the asset.
 

 ![swapbcre.jpg](https://images.ecency.com/DQmf2r7HiipujuRj9RHxUgYpv94gwv92fJRSEizEPi21vfK/swapbcre.jpg)
[Crescent Defi](https://app.crescent.network/swap)

### Liquid Staking is simplified with stakes distributed to verified Whitelisted validators

With this methodology of liquid staking, one can easily stake to verified well performing validators as our delegated stake will be equally distributed to white listed validators who qualify because they full fill necessary criteria.

 This is convenient, as we otherwise have to select a validator doing complex research evaluating their performance analysing the data from the Blockchain’s explorer.

![mintscan.jpg](https://images.ecency.com/DQmZAsmMKSApdynGTRahqULsnL5RiqzYvtsJnWSSaFfYG1n/mintscan.jpg)
*Cosmos Blockchain explorer [mintscan](https://www.mintscan.io/cosmos/validators), here you can check and evaluate the performance of validators.*


Since, the crypto holders stake is spread out equally to whitelisted validators, this diversifies slashing risks. A validator’s stake is slashed if they act maliciously attacking the network or are offline too often with their validation performance not being up to the mark.

** Conclusion**

Shade Protocol also uses similar staking mechanisms with stkd-SCRT while Luna’s Anchor Protocol provides for bLuna or bonded Luna. With this new evolved ways of staking crypto in POS 
Blockchains and applications there is no need to stake crypto the hard way as we do traditionally. 

The advantage of the evolved way of staking in POS Blockchains is that their liquidity can be leveraged in DEFI, which is a huge bonus as apart from getting staking rewards, one can also reap additional rewards using the staked asset in DEFI.

**Thank you for reading.**