What are the risks involved in staking cake?

1 answers

• Nov 25, 2021 · 3 years ago
  When it comes to staking cake, it's important to be aware of the potential risks involved. One risk is the possibility of impermanent loss, which occurs when the value of the staked tokens diverges significantly from the value of the underlying assets. This can happen in volatile market conditions and may result in a loss of value compared to simply holding the tokens. Another risk is the reliance on the platform's governance decisions. If the platform undergoes a contentious hard fork or faces governance issues, it could lead to a loss of confidence and value for the staked tokens. Additionally, staking cake involves giving up control of your tokens for a specific period of time, which means you won't be able to use them for other purposes or take advantage of other investment opportunities. It's important to carefully weigh these risks before deciding to stake cake tokens.
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