If you are not familiar with staking or staking rewards please take the time to review the content from the link below.
https://www.binance.vision/blockchain/what-is-staking
The idea behind allocated staking rewards is that a user is able to decided how they want their rewards to work for them.
- Have a percentage of the rewards sent to a charity wallet
- Have a percentage of the rewards sent to a child’s or any type of support/savings wallet
- Have a percentage of the rewards sent to a content creator
Furthermore, allocated staking rewards could be nested within smart contracts to do some pretty funky things. Let’s say that you like the idea of day trading but don’t feel comfortable day trading yourself. You can have your staking rewards sent to a pool of a day trader, who then day trades with your rewards as well as others. The trader specifies the date range in which the funds will be used on and returns the funds + gains and – fees.
What ends up being creating is a lower risk investment that allows you to increase the return on your staking rewards; with the chance to only lose your staking rewards while holding onto your initial investment (staked asset).
The beauty of this is you do not need another blockchain project to run this, it can be implemented at the exchange level. This allows for the receiver of the funds to designate how they want the staked rewards to be allocated. Ex. a charity may want to have all the funds converted into fiat (once a specific threshold is met.)
Lastly you could create a lottery system similar to what https://www.pooltogether.com/, is trying to accomplish. At the end of the day, interest and staking rewards are the same thing.