A few days after the launch of the staking on Binance for the Zilliqa crypto, we see that not very encouraging APR percentages are starting to emerge on the exchanges that have or still have to open pools to deposit ZIL, as in the case of Binance which should open on June 26, 2020.
Contrary to what may appear and therefore think that this blockchain uses some kind of PoS (Proof of Stake) system at the base, we must remember that this blockchain has a hybrid system of consent protocol that is given by PoW (Proof of Work) and PBFT (Practical Byzantine Fault Tolerance), Moreover, thanks to the implementation of sharding on the network, this allows to have a high throughput, so at a technical level this blockchain can compete with others of equal rank and its smart contract system, using Scilla as programming language.
As we have said this blockchain has recently opened also to the possibility of staking the related tokens and therefore allow everyone to get rewards for blocking the same and as a first boot test have chosen their own quite relevant platforms such as KuCoin and Binance, and in this way the various users of these centralized exchanges can offer a not indifferent ease of access.
And it is here that the problem of the APR of Zilliqa is born, because some stakes have been fixed for the APR itself, in fact this is fixed at 10% but decreases as the size of the pool that a platform has, in fact only if you do not exceed the threshold of 61 million ZIL then you get a return of 10% while the more you go forward is less convenient is for the staker.
In fact, one element that plays against these numbers is precisely the supply that is 9 zeros, the total supply of 21 billion, while the circulating one of just over 10 billion, so it is understandable that on balance you always exceed the threshold of 61 million, also because the cost of ZIL is very low, we are talking about just $ 0.019, so we are talking about pools of just over $ 1 million dollars.
If we go to deepen the various APR that we find on the exchanges we can see that on KuCoin we have a minimum of 3% and a maximum of 10%, so quite miserable and as reported by some users has dropped even to 2.2%, if we move instead to Binance then the situation is more dramatic because the minimum of APR is even 0% so in fact cancels any staking advantage, and this a few days after the opening of the relative pool, and value that makes it the least convenient staking asset to use, especially on Binance, and remember that already Binance alone holds 38% of the supply in circulation and therefore are just over 4 billion ZIL, as reported by Blockfire.
With this type of figures certainly loses ground and makes sense to stagger and then block their tokens if they do not yield anything and makes it more interesting any crypto that still has the minimum of 1%, so with the same crypto a user would prefer to bet on other more interesting and give a greater APR, for the record on Binance is TROY 15-16% while on KuCoin there is NWC that reaches 60%.
At this point it is legitimate to ask whether the staking on Zilliqa, at least on the exchange side, has failed before starting.