A Guide to Staking on Tezos

Linda from TriliTech has released a detailed video series explaining how to get started with staking on the Tezos blockchain. This new feature, introduced in June 2024, offers Tez holders an opportunity to earn rewards by participating in the network. Here's a comprehensive guide based on the series, with detailed step-by-step instructions to help you navigate staking on Tezos.

A Guide to Staking on Tezos

Linda from TriliTech has released a detailed video series explaining how to get started with staking on the Tezos blockchain. This new feature, introduced in June 2024, offers Tez holders an opportunity to earn rewards by participating in the network. Here’s a comprehensive guide based on the series, with detailed step-by-step instructions to help you navigate staking on Tezos.

What is Staking?

“If you’re not aware already, staking was actually introduced to Tezos in June 2024,” Linda begins. She explains, “This means that for individual Tez holders like you and I, we can now stake as a way to earn rewards on our Tez.”

Previously, Tez holders could only delegate their tokens to participate in the network. Staking builds upon this feature. Linda clarifies, “Now, you can both delegate and stake. So why do I say delegate and stake? That’s because staking on Tezos is a two-step process. First, you delegate, and then you stake.”

This dual process makes Tezos unique. Linda elaborates, “You have a few options as a Tez holder. You can either just delegate, or you can delegate and stake.” She assures viewers, “If this sounds complicated, don’t worry. We’re going to walk you step by step through the entire process in this video series.”

Understanding the Benefits of Staking

The key benefit of staking is higher rewards. “The rewards are twice that of delegation,” Linda notes. To view current reward rates, she demonstrates navigating to TZKT.io. “Let’s go down to the Proof of Stake column right here. As we can see, Estimated APY. So now we see two numbers. The first one is for delegation, and the second is for staking.”

Choosing a Reliable Baker

Bakers play a crucial role in the Tezos ecosystem by validating transactions and securing the network. Linda highlights their importance: “If you hold Tez and you want to earn rewards, you can assign your Tez to a baker for a slice of their total rewards.”

When choosing a baker, Linda suggests considering the following:

Linda warns against overstaked bakers, saying, “Don’t stake with a baker that’s overstaked because this is going to dilute your rewards.”

Tools You Need to Start Staking

To begin staking, you will need the following:

For her demonstration, Linda selects Kukai, saying, “I’m going to go with Kukai because it’s super easy to use. But really, you can use any wallet provider in this list.”

Detailed Step-by-Step Staking Process

Step 1: Delegate Your Tez

Delegation is a way for Tez holders to earn rewards without running a node themselves. Linda explains, “You do so by assigning your Tez to a baker, a.k.a. a validator, who does the work and gives you a proportional slice of the rewards.”

To begin:

Step 2: Stake Your Tez

After delegation, the next step is staking. Linda explains, “Once you stake your Tez, they’re locked up, and unlocking them or unstaking them will take about 11 days.”

Steps to stake:

How to Change Your Baker

Sometimes, you may wish to change your baker due to changes in fees, performance, or personal preference. Linda explains, “If you’re staking, you essentially have to unstake your stake first and then delegate to the new baker.”

Here are the steps to change your baker:

Linda emphasizes the importance of researching bakers, saying, “Don’t forget that the amount of rewards you receive is based on the amount of rewards they receive.”

Risks and Considerations

Staking on Tezos is generally safe, but it’s essential to understand potential risks. Linda explains, “Slashing is when a baker is penalized for misbehavior. This can include not participating enough in governance or not running an active node.”

Additionally, funds staked are locked for a period of time. Linda reiterates, “Unlocking them or unstaking them will take about 11 days.”

Final Thoughts

Staking on Tezos provides an excellent opportunity for Tez holders to earn rewards while contributing to the blockchain’s security. Linda’s comprehensive walkthrough ensures that even beginners can confidently start staking.

“If you’ve followed along up until here, you should now officially be a staker on Tezos. Hooray!” Linda concludes. For additional details, visit Stake.Tezos.com or explore the full video series for more insights and advanced tips.

Disclaimer

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