Staking
DeFi Strategies, Yield Models, Token Income
Staking is the process of locking up cryptocurrency in a blockchain network to support its operations, such as validating transactions and securing the network. In return, participants earn rewards—often in the form of additional tokens. Staking is commonly used in Proof of Stake (PoS) and similar consensus mechanisms and offers a way to earn passive income while contributing to network integrity.
Use Case: A user delegates their tokens to a validator in a PoS network, earning new tokens as rewards while helping secure the blockchain.
Key Concepts:
- Proof of Stake — Consensus mechanism where validators are chosen based on staked assets.
- Staking System Overview — Framework of staking models across blockchains.
- Staking Reward Strategy Index — Approaches to maximize yield from staking.
- Validator Node — A node that participates in securing the network through staking.
Summary: Staking allows participants to earn yield while strengthening the blockchain. It is a core element of DeFi income strategies and a key part of Proof of Stake ecosystems.