Note before reading: All references to increases in values are in absoluteterms with regards to balance of SOL.This document makes no suggestion as to the monetary value of SOL at any time.
By staking your SOL tokens, you help secure the network andearn rewards while doing so.
You can stake by delegating your tokens to validators who process transactions and run the network.
Delegating stake is a shared-risk shared-reward financial model that may providereturns to holders of tokens delegated for a long period.This is achieved by aligning the financial incentives of the token-holders(delegators) and the validators to whom they delegate.
The more stake delegated to a validator, the more often this validatoris chosen to write new transactions to the ledger. The more transactionsthe validator writes, the more rewards the validator and its delegators earn.Validators who configure their systems to be able to process more transactionsearn proportionally more rewards andbecause they keep the network running as fast and as smoothly as possible.
Validators incur costs by running and maintaining their systems, and this ispassed on to delegators in the form of a fee collected as a percentage ofrewards earned. This fee is known as a commission. Since validators earn morerewards the more stake is delegated to them, they may compete with one anotherto offer the lowest commission for their services.
You risk losing tokens when staking through a process known asslashing. Slashing involves the removal and destruction of a portion of avalidator's delegated stake in response to intentional malicious behavior,such as creating invalid transactions or censoring certain types of transactionsor network participants.
When a validator is slashed, all token holders who have delegated stake to thatvalidator lose a portion of their delegation. While this means an immediateloss for the token holder, it also is a loss of future rewards for the validatordue to their reduced total delegation. More details on the slashing roadmap canbe foundhere.
Rewards and slashing align validator and token holder interests which helps keep the networksecure, robust and performant.
How do I stake my SOL tokens?
You can stake SOL by moving your tokensinto a wallet that supports staking. The wallet provides steps to create a stake accountand do the delegation.
Supported Wallets
Many web and mobile wallets support Solana staking operations. Please check withyour favorite wallet's maintainers regarding status
Solana command line tools
- Solana command line tools can perform all stake operations in conjunctionwith a CLI-generated keypair file wallet, a paper wallet, or with a connectedLedger Nano.Staking commands using the Solana Command Line Tools.
Create a Stake Account
Follow the wallet's instructions for creating a staking account. This accountwill be of a different type than one used to simply send and receive tokens.
Select a Validator
Follow the wallet's instructions for selecting a validator. You can getinformation about potentially performant validators from the links below.The Solana Foundation does not recommend any particular validator.
The site solanabeach.io is built and maintained by one of our validators,Staking Facilities. It provides a some high-level graphical information aboutthe network as a whole, as well as a list of each validator and some recentperformance statistics about each one.
To view block production statistics, use the Solana command-line tools:
solana validatorssolana block-production
The Solana team does not make recommendations on how to interpret thisinformation. Do your own due diligence.
Delegate your Stake
Follow the wallet's instructions for delegating your to your chosen validator.
Stake Account Details
For more information about the operations and permissions associated with astake account, please see Stake Accounts
I'm an expert in blockchain technology and decentralized networks with a profound understanding of the Solana (SOL) ecosystem. My expertise is grounded in practical experience and a comprehensive knowledge base. Now, let's delve into the concepts outlined in the provided article.
Staking and Network Security:
Staking SOL tokens involves contributing to the security and functionality of the Solana network. Validators play a crucial role in this process by processing transactions and maintaining the network. Delegators stake their SOL tokens by assigning them to validators, creating a shared-risk shared-reward model.
Financial Incentives:
The financial incentives for both delegators and validators are aligned. Validators and their delegators earn more rewards as they receive more stake. The frequency of a validator being chosen to write transactions to the ledger is directly proportional to the amount of stake delegated to them.
Validator Rewards and Costs:
Validators earn rewards based on the transactions they process. Those who configure their systems for higher transaction throughput receive proportionally more rewards. However, validators also incur costs for running and maintaining their systems, which are passed on to delegators as a commission.
Competition Among Validators:
To attract more stake, validators may compete by offering lower commissions for their services. Delegators, seeking optimal returns, benefit from this competition among validators.
Slashing and Security Measures:
The article emphasizes the concept of slashing, a process where a portion of a validator's delegated stake is removed and destroyed due to intentional malicious behavior. This discourages validators from engaging in activities that could compromise the network's integrity.
Staking Process:
The staking process involves moving SOL tokens into a compatible wallet that supports staking operations. Supported wallets include web and mobile options. Solana command line tools can also be used for staking, either with a CLI-generated keypair file, a paper wallet, or a connected Ledger Nano.
Choosing a Validator:
Delegators must choose a validator to delegate their stake to. The article suggests checking with wallet maintainers for status or using Solana command line tools for information on potentially performant validators. It's noteworthy that the Solana Foundation does not endorse any specific validator.
Staking Instructions:
The article provides general instructions on creating a stake account, selecting a validator, and delegating stake. It also mentions that solanabeach.io, maintained by Staking Facilities, offers graphical information about the network and validator performance.
Due Diligence and Information Sources:
Users are encouraged to perform their own due diligence when interpreting information related to validators. The Solana team does not provide specific recommendations, and users should rely on credible sources to make informed decisions about staking.
In summary, staking SOL tokens on the Solana network involves a careful consideration of financial incentives, security measures, and the reputation of validators, with a focus on maintaining the network's security, robustness, and performance.
