Term
Staking
Staking is locking cryptocurrency to help secure a proof-of-stake blockchain in exchange for token rewards — validators stake capital as collateral, and users delegating to validators earn a share of the block-reward yield.
Staking is how proof-of-stake blockchains produce blocks. Instead of mining with computational work, validators lock ("stake") a chain's native token as collateral, and are randomly selected to propose and validate blocks in proportion to their stake. If they misbehave, their stake can be slashed.
Users who don't run their own validator can "delegate" to one — locking their tokens in a way that supports a validator and receiving a proportional share of the block rewards, minus a validator commission. Ethereum, Solana, Cosmos, Polkadot and most modern chains all have staking mechanisms with slightly different rules.
Liquid staking derivatives (stETH from Lido, cbETH from Coinbase) issue a tradeable token representing the staked position, so users retain liquidity while their underlying is staked. Yields depend on the chain — Ethereum has been running around 3-4% APR, Solana around 6-7%, higher-inflation chains offer more but with corresponding token dilution.
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