Staking is when you lock crypto assets for a set period of time to help support the operation of a blockchain. In return for staking your crypto, you earn more cryptocurrency.
Many blockchains use a proof of stake consensus mechanism. Under this system, network participants who want to support the blockchain by validating new transactions and adding new blocks must “stake” set sums of cryptocurrency. Staking helps ensure that only legitimate data and transactions are added to a blockchain.
If you own a cryptocurrency that uses a proof of stake blockchain, you are eligible to stake your tokens. In exchange for locking up your assets and participating in the network validation, validators receive rewards in the cryptocurrency known as staking rewards.
APY, Annual Percentage Yield, is the most important key element in staking because it represents how much interest a user would receive for the bonded asset in one year.
When you choose a program, it will tell you what it offers for staking rewards – APY. Than select how much of your tokens you want to put up for staking. There is min and max stake amount. Once you`ve committed to staking crypto, you will receive the promised return according to the schedule. The program will pay you the return in the staked cryptocurrency.
Interest accrues the day after you start staking. You get daily earnings, starting from the day following interest accrual. After the subscription period, the earnings are deposited into your account.