Binance Provides Clarity Over DOGE Locked Staking

Binance Provides Clarity Over DOGE Locked Staking

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Binance’s new “locked staking” program for Dogecoin (DOGE) stirred up quite the confusion on social media. Mishaboar, a well-known advocate of Dogecoin, urged investors to steer clear of the exchange’s latest venture. Mishaboar questioned how it was possible to stake tokens of a proof-of-work-based model.

However, the exchange has come forward, clarifying the matter. According to the exchange, the tokens will not be lent out for additional profits, and the tokens would remain in custody with the exchange.

Via a mail to CoinDesk, Binance’s spokesperson said,

“There is no on-chain staking of LTC and DOGE for network validation since these are non-proof-of-stake tokens. The user funds remain with Binance and we have very strict risk management controls to ensure their security.”

He stated that the APR rewards come directly from Binance.

Upon the announcement, many were displeased with the vague wording of the program. Moreover, Dogecoin creator Billy Markus also took a swing at the announcement.

Having a proof-of-work consensus mechanism, cryptos such as Dogecoin, Litecoin (LTC), and Bitcoin (BTC) do not have the option of staking. Meanwhile, staking is a feature of the proof-of-stake (PoS) consensus mechanism wherein validators stake their tokens to secure the network. PoS blockchains include Polkadot (DOT, Cardano (ADA), and Ethereum 2.0. Ethereum 2.0 is scheduled to go live in September of this year. Nonetheless, the “merge” has riled up investors, which has rallied the tokens price by up to 36.6% in the last seven days.

Other Dogecoin developments

Dogecoin has released another core version of itself. The update, 1.14.6, will bring more security and efficiency to the DOGE network. In addition, the developers have changed the fee structure along with the security fixes. The update also improves stuck transaction detection, which helps reduce lag.

Also, Elon Musk, probably the most popular Dogecoin influencer, revealed that his Tesla company had not sold any of its Dogecoin holdings, even though the company sold 75% of its BTC holdings. This comes as a sigh of relief to many DOGE holders.

At press time, Dogecoin was trading at $0.070636, up by 3.6% in the last 24 hours.