Cardano’s goal is to be the most environmentally sustainable blockchain platform. It uses a unique proof-of-stake consensus mechanism called Ouroboros, as opposed to the energy-intensive proof-of-work system currently used by Bitcoin and Ethereum.
Proof-of-stake requires people to delegate their $ADA to a pool.
ESG has become a growing trend in financial markets, with portfolio managers increasingly incorporating sustainable investments into their strategies.It has led companies who accept crypto like Bitcoin to be conscious of their ethical and environmental responsibilities. This recent condemnation of Bitcoin’s high energy consumption has led to a new consensus that focuses on shifting to coins with sustainable investing strategies.While the ESG energy concerns affect cryptocurrencies like Bitcoin, it favours the alternatives, also known as ‘green coins’ like Cardano.
Your ADA represents a stake in the Cardano blockchain network, by staking (delegating) your ADA to a Stake Pool you are supporting the decentralisation of the Cardano network and earning rewards (on average 5% a year) for doing so. You can find out more about stake delegation on the Cardano organisation website.
The beauty of the Cardano staking system is that your coins never leave your wallet when they are delegated!
There is no minimum period and any rewards earned are paid to your wallet every Cardano epoch (5 days). You can move your coins any time you like.
When you initially delegate, it will take 15-20 days until you first receive rewards, depending on your pool's performance. You will continue to receive rewards every 5 days thereafter. Think of it like stock dividends. You don't get paid immediately when you buy the stock. You have to wait for the record date, then the actual dividend payout date. This is part of what is happening with the epoch change.
The fees come out of the total reward the pool pays out. This does not come out of the ADA you already own. It forms the donations we make to charitable causes.
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