Stakes rising: the business of creating cryptocurrencies  

he adage “money begets money” is being given a twist in the world of decentralised finance. Here, people can make cryptocurrencies by creating cryptocurrencies. It’s a process called “staking” that promises eye watering interest rates – if you can stomach the inevitable risks that come with it.

Cryptocurrencies run on blockchains that rely on their users to validate the transactions that are carried out on them. Transaction validators are rewarded with a batch of freshly minted cryptocurrencies that happen to run on that blockchain.

Some blockchains (not bitcoin) require validators to stump up a “stake” of cryptocurrencies as a form of deposit. Lazy or malicious validators can be fined for sloppy service - or lose their deposit (stake) altogether if they prove to be bad actors.