Elrond: how the platform works and what newcomers need to know

Elrond is a blockchain platform. The Elrond network can process up to 15,000 transactions per second, making it one of the most productive blockchains. Transactions on Elrond are confirmed almost instantaneously. In comparison, Ethereum can process up to 15 tps and Tron up to 1,000.

This high throughput is achieved by segmenting (sharding): the network is divided into several interconnected shards, which can run in parallel with each other. This increases the performance and speed of transactions. The same principle is implemented in the Eth 2.0 update, but sharding already works in Elrond.

Elrond is based on the Secure Proof-of-Stake or SPoS consensus mechanism. Validators, of which there are now more than 2169, keep the network running. Any users can become validators of the network or delegate EGLD tokens issued on Elrond’s blockchain and get compensation for this.

Elrond uses the TargetShardLoad method, which aims to keep shard loads no higher than 50% given a possible spike in activity. But it rules out low usage; otherwise it becomes unprofitable to maintain the network. Elrond also offered an improved approach to SPoS node matching.

Elrond price charts: Secure Proof of Stake

The Elrond platform uses a modified Secure Proof-of-Stake (SPoS) consensus algorithm. Elrond nodes form a consensus group ranking, which is used to determine the chances of becoming the next block’s validator. Validators are “shuffled” randomly and can be redistributed to another segment. This maintains a high level of network security. This has a positive effect on Elrond price charts

A new source is determined by signing the previous random source generated by the validator. Validators receive Elrond tokens (EGLD) for successfully adding blocks.

Elrond coin price chart: features of Elrond stacking (EGLD)

Direct stacking in the Elrond network is available only for validators. This is a great way to make money if you don’t want to track Elrond coin price charts. You need to run your own node and block a large amount of tokens, 2500 eGLD to be exact. Otherwise, your node will have no chance to be nominated as a validator.

But ordinary users can delegate tokens to validators, generating revenue even from small amounts. Almost all wallets in which EGLD tokens can be stored support such stacking. Delegators pay a commission to the validators, so they get a little less. The commission is set by the validators themselves.

The minimum amount to delegate is 10 EGLD. In addition to the amounts and profitability: validators get up to 36% per annum, while delegators – only 29%. But the amount of income depends on other factors. At Elrond, there are two types of delegation: Active and Waiting List Delegation.

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What is the difference between Active and Waiting List Delegation

Active delegation is the classic way of stacking, where you simply pass tokens to a validator and collect regular rewards. In this case, you get up to 36% ROI. But with this approach, users only get rewards if their validator has received rewards.

Right now, users can’t delegate actively because Elrond’s network is full of delegate nodes. Therefore, the developers have added a Waiting Queue.

When delegating the Waiting List type, the reward goes to all participants who occupied the queue in proportion to the amount of delegated tokens, regardless of any factors. Waiting List delegates get up to 20% of the annual reward, but they do not depend on the success of their validators.

The Elrond price now is very favorable. Elrond has a Phase 3 release coming soon, which is changing the token delegation system. In Phase 3, the platform will add open delegation, which will be implemented at the protocol level using system smart contracts.

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