Glossary / Staking
Staking
Staking means locking up coins on a proof-of-stake network to help secure it, in exchange for rewards paid in that coin. You can stake directly by running a validator, delegate to a validator while keeping custody, use a liquid staking protocol that gives you a tradeable receipt token, or stake through an exchange.
Rewards are not free money. They come largely from newly issued coins, so if you do not stake you are diluted. Risks include price falls, lock-up or unbonding periods during which you cannot sell, slashing penalties if your validator misbehaves, smart-contract bugs in liquid staking protocols, and counterparty risk if a platform holds your coins.
Advertised yields vary by network and change over time; check whether a quoted rate is before or after the provider's commission.
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