Staking SOL is one of the best ways to leverage the financial benefits that come with the blockchain. If you’re looking to get involved in this exciting project, you may be wondering how to stake Solana tokens. In this article, we’ll walk you through the process step-by-step.
What is Staking?
Staking is locking up your crypto assets in a fixed account to get profits. It is a widespread investment opportunity on Solana and across multiple other blockchain applications. Staking has grown popular because it not only generates rewards for investors but also provides liquidity for the blockchain or the token involved.
How Does Staking Work?
Typically, staking occurs when you lock up your crypto assets in DeFI wallets that support Solana staking. Depending on the wallet you select, there will be a different procedure for how to stake. Still, it will often involve determining the amount of crypto assets you want to stake and the duration you want to stake them for.
The staking process on Solana is almost similar to the staking description, although it comes with a few twists. To begin with, staking on Solana takes a proof-of-stake PoS approach. This means that staked coins are used to mint new tokens or create new blocks on the blockchain. Validators handle the minting process on Solana.
Solana also incorporates a proof-of-history (POH) process when new blocks are formed. This unique metric helps identify the time sequence of every transaction, making it easily traceable to its source.
Who Is a Validator And a Delegator on Solana?
A validator in Solana staking is the person or organization that uses PoS to generate new blocks on the Solana blockchain. Validators are responsible for checking crypto transactions and adding them to the blockchain.
Delegators, on the other hand, are individuals who contribute their crypto assets for staking. For instance, if you stake SOL through one of the crypto wallets that supports SOL staking, you’re called a delegator.
Both delegators and validators earn crypto for free when staking. Typically, a validator will make a certain percentage of profit, called the Annual Profit Yield (APY). Part of this APY, called a commission, remains with the validator, while the other part is given to the delegator as their staking reward. This means that for you to stake natively on Solana, you have to stake through a given validator.
How You Can Stake SOL Natively on Solana
The first step towards staking on Solana is identifying a crypto wallet with staking options. After identifying a wallet, the next step is transferring funds to the wallet, and the final step is staking your funds.
The Solana blockchain is home to several crypto wallets. However, two of these stand out the most. The first is Solflare, which Solana recommends, and the second is Trust Wallet, a popular DeFi wallet that supports over 4.5 million crypto assets. This article will use both wallets to show you how to stake on Solana.
Step 1: How to Set up a Solana Staking Wallet
When it comes to a Solana staking wallet, you can choose one of the two most popular alternatives, Solflare or Trust Wallet. Whichever you choose, the process is seamless and you should have your coins staked in no time. Here’s a step-by-step walkthrough on how to set up both wallets.
Setting up Solflare Wallet
Solflare digital wallet comes with a browser and mobile extensions that you can use to store, swap, stake or send Solana. Now. let’s go through the steps you need to follow to have your wallet up and running.
- First, visit Solfare’s website and click on the Download button on the home page.
- This will redirect you to the Solflare wallet extension page on Google Chrome to add the wallet as one of your extensions.
A pop will appear. Click Add Extension
- With the wallet added, click on the Puzzle icon at the top right side of your Chrome tab, scroll through your list of extensions till you find Solflare and click on it.
- When a new tab opens, click the Create a New Wallet option that appears, and enter a password for your Solflare wallet account.
- After setting up a password, you will receive a Recovery Phrase on your screen.
If you lose or forget your password, recovery phrases help you access your wallet. This means it’s essential to store your recovery plan somewhere where you can retrieve it should the need arise. It’s also necessary to store it where other people cannot come across it because they can use it to access your wallet.
- Click on the Download Backup button to get a copy of your recovery phrase, click the Copy to Clipboard button to copy it for the next step, and tap on the I Wrote Down My Mnemonic button.
- Paste the recovery phrase you just copied into the field that appears and click on Verify to verify your recovery phrase.
- Now just create your wallet password and like that, you have successfully set up your Solflare wallet.
Setting up a Trust Wallet
Trust Wallet is the other digital crypto wallet you can use to stake Solana. It comes with an iOS and Android app to give you the convenience you need to store, send, or stake tokens. Trust Wallet also has one of the most straightforward setup procedures. Here’s what you need to do to set up this crypto wallet.
- Download and install the Trust Wallet app for iOS or Android.
- Launch the app and click on the Create a New Wallet button.
- You will receive a recovery phrase, store it safely and click the Copy button to copy it for the next step.
- Verify the recovery phrase by pasting it on the field that appears, and you will have successfully set up your Trust Wallet account.
Step 2: How to Fund Your Solana Staking Wallet
Once you set up your wallet, you need to fund it with SOL. Both Solflare and Trust Wallet follow a simple process for receiving Solana. Here’s how to fund Solflare and Trust Wallet with SOL.
Funding Solflare with Solana
It is simple to fund a Solflare wallet with SOL. Here are the steps you must take to transfer Solana to Solflare.
- Navigate your Solflare wallet and click on the Receive button at the top right side of your dashboard.
- A tab will open with your account’s main Solflare authority address. The authority address also comes as a QR code.
- Copy the address or scan the QR code. You can use this address on the platform where you want to withdraw SOL to instruct where to send the funds.
Funding Trust Wallet with Solana
If you choose to stake Solana with Trust Wallet, you need to make sure it has enough SOL to stake. Follow the steps below to add Solana to your Trust Wallet account.
- Launch your Trust Wallet app and click on the Wallet button at the bottom of your dashboard.
- When your wallet opens, click the Receive option at the top center of your tab.
- Type in “Solana” on the search bar and click on the Solana option that appears.
- This opens a window with the recipient’s address and a QR code. With this address, anodyne can send you SOL, or you can transfer the tokens from other platforms where you have stored them.
Step 3: How to Stake Solana
There are two main ways of staking Solana. You can do liquid staking, which enables you to use and stake your tokens simultaneously. Alternatively, you can apply the most common staking method, native staking. Native staking involves locking up your tokens for a fixed period. To illustrate the staking process on Solana, this article will refer to native staking on Solflare and Trust Wallet.
Staking Solana on Solflare Web App
Solflare offers investors a quick and efficient way to stake Solana natively. Let’s walk through the steps you need to follow to stake Solana on Solflare.
- Visit the Solflare website and click on the Access Wallet option on the far right side of your dashboard.
- On the page that opens, click the Staking option on the navigation bar.
- Select the Native SOL Staking option at the center of your dashboard to stake natively. If you don’t, you will end up on the liquid staking dashboard.
- Tap on the Sol Staking button, enter the amount of SOL you want to stake and select a validator.
When choosing a good validator, you need to look at the fee they will take out of your staking rewards. A staking rate of 10% or less is okay, but you can decide better based on the offers of the listed validators.
- After selecting a validator, click the Stake button, and proceed to click the Confirm button to finish the transaction.
It’s important to note that you won’t start earning an interest in Solana right away. There are cool-down and warm-up periods in Solana. Warm-up refers to the time between staking and your staked funds becoming active, whereas cool-down refers to the time between unstaking and your funds becoming inactive. Warm-up and cool-down are measured in epochs.
One epoch lasts three days, and both the warm-up and cool-down periods last an epoch. This means that it takes three days from the time you stake your SOL to start earning rewards and three days to get your funds back.
Staking Solana on Solflare Mobile App
Solflare comes with a mobile app that you can also use to stake Solana. Here’s a walkthrough of the SOL staking process on the Solflare mobile app.
- Open the Solflare mobile app, and select the Staking option.
- Click on the Create New Staking Account button on the tab that opens.
- Enter the amount of SOL you want to stake and click Next.
- Select the validator you want from the list presented on your screen.
- Finally, swipe the Swipe to confirm button to complete the transaction.
Staking Solana on Trust Wallet
Trust wallet is one of the wallets with the highest Annual Percentage Yield (APY) for staking Solana. Here is how to stake Solana on Trust Wallet.
- Launch your Trust Wallet app and click on the Discover button at the bottom of your dashboard.
- When the new tab opens, Scroll to find Solana.
- Then click the Stake option at the top center of your tab.
On the staging dashboard, you will see the total amount of Solana in your account, the staked amount, and the minimum amount you can stake. You can also see the Annual Percentage Rate (APR) that you will earn while staking.
- Click the Stake button that appears after these details to open the list of validators.
- Select a validator, enter the amount of Solana you want to stake, and click Next.
- Verify your transaction’s details and click Confirm once you are satisfied that everything is correct
FAQs
What’s the Best Way to Stake Solana?
The best way to stake Solana is through native staking. Although you can stake Solana through liquid staking, which allows you to use your tokens even when staked, native staking is more direct and has fewer factors to consider, making it a better staking method.
Is Staking Solana Worth It?
Staking Solana is worth it. This is primarily a passive way of making money from your SOL tokens, so it’s worth a shot. You can earn decent interest on Solana ranging from 5.7% depending on the staking wallet you choose. If you want to estimate your rewards there’s the Solana Staking reward formula that helps you do the math.
How Long Does It Take To Stake Solana?
Staking Solana takes about three days from the day you complete the staking process. This period is referred to as warm-up.
Are There Risks Associated With Staking?
Staking is a financial investment, and like all financial investments, it comes with a risk. The highest risk is volatility, which can reduce the value of the locked tokens. For this reason, it is important to understand staking in depth before taking part in it.
Where Can You Stake Solana?
You can stake Solana on any DeFi wallet that supports Solana staking. Preferably, you can use the Solflare wallet, which Solana recommends, or you can stake Solana on Trust Wallet, which is a more popular wallet in the crypto space.
