Do you hold KMD? We have news for you: you are earning interest! The best part is that even your cold storage address buried 10 feet into the ground is accumulating more precious KMD.
You don't have to go online to acquire the interest, or keep any wallet open. However, if you buried your seed into the ground, you would have to dig it up and send them to a new address once a year.
This unique property somewhat resembles the 'staking' mechanism, which all Proof of Stake blockchains have. Komodo, however, is a Proof of Work cryptocurrency with the delayed Proof of Work mechanism built on top.
With most PoS systems, users are required to “Stake” their coins by leaving their wallet open. However, this traditional method has several disadvantages for users. While the process doesn’t require any special hardware or a considerable amount of computing power, users must leave their computer on at all times, and they are forced to keep a copy of the blockchain on their hard drive.
Komodo prides itself on being unique, and this is yet another point where the Komodo Platform stands out among other cryptocurrencies. With Komodo, we don't require users to “stake” their coins. Instead, these gain interest simply by being stored in a wallet! Users are not bound to go online, but only to spend their coins from time to time.
Another disadvantage: with staking only one address can receive interest in any given block. The bigger the balance, the more likely you are to stake, because of this the small accounts might never stake a new block, or at least might need some patience. With Komodo any balance larger than 10 KMD starts to earn interest just after one hour. You will be able to see your balance increase each block!
We have a 5 % cap for how much interest a single address can acquire, that means that after one year you would have to send the coins to a new address. By now all the math geeks calculated that you would receive 5 % return per year, or APR (Annual Percentage Rate). That is very true, and in fact, you could get even more.
How to get rich is a great secret not too many know, but we will share it with you here. The answer is simple: 'compound interest.' If you want to accumulate even more KMD you need to get your interest to earn more interest. You won't receive the new coins until you have sent the coins, so the more often they are sent, the more KMD you receive.
It is also worth noting that this 5% APR rewards will eventually disappear once all 200 million KMD coins are mined. We estimate this to take at least 14 years but could take longer.
In summary, our interest rate technology is:
zero footprint - no blockchain bloat
automatic - you don't have to do anything
constant - you get paid all the time
Now go and watch how your coins multiply!