My understanding of proof of work is that basically (miners/CPUs provide power to write transactions on the blockchain) whereas Proof of stake (is when we hold a certain currency and lock it into the systemso liquidity increases).Please correct me if im wrong.
Also why is it that only some coins can be staked?What are the conditions for a coin to be eligible to be staked?
And why are the returns on staking different on different exchanges?Is it simply due to difference in commission ,as logically the return on staking should be universally same depending upon the lock in period?
Staking is not something that works for every cryptocurrency. The cryptocurrency that you are holding has to allow such before you can stake it. Bitcoin cannot be staked, but there are some exchanges that would allow you to deposit your Bitcoin or any cryptocurrency at all into a savings account or something like that and you will be earning interest per annum, the interest goes anywhere around 4% to 6% per annum, and even as high as 20% for some altcoins.
So, you cannot stake Bitcoin for now, but you can stake Ethereum (because of the ETH 2 upgrade). And then other cryptocurrencies that you can also stake are Texos, and Cosmos. There are also many others that you can stake, you can just look for the ones you believe are really good and you can select them and start staking them.