Key Takeaways

• Staking allows certain cryptocurrencies to earn rewards while you hold them.

• These rewards come from helping support the blockchain network.

• Reward rates can change depending on network activity.

• Some blockchains require a waiting period when assets are unstaked.

• Not every cryptocurrency supports staking.

 

What Staking allows you to do

Most cryptocurrencies simply sit in a wallet after they are purchased. Staking allows certain assets to generate rewards while you hold them.

By staking your crypto, those assets help support the blockchain network that processes transactions and maintains security. In return, the network distributes rewards to participants.

For investors planning to hold their assets over time, staking can be a way to put those holdings to work instead of leaving them idle.

 

How Staking works

The basic idea behind staking is simple.

Step	What Happens	What It Means For You
1. Hold a supported asset	You own a cryptocurrency that supports staking.	Your crypto becomes eligible to earn rewards.
2. The network uses staked assets	Your crypto helps support the blockchain by validating transactions and maintaining network security.	The network relies on participants who stake tokens.
3. Rewards are generated	The blockchain distributes rewards to participants who stake their tokens.	You receive rewards while continuing to hold your asset.

 

What is staking?

Many blockchains use a system called Proof-of-Stake (PoS).

Proof-of-Stake is a blockchain system where participants lock up some of their crypto. That locked crypto is the “stake,” proving they have something at risk while helping secure the network.

By staking their assets, token holders contribute to the network’s security and transaction processing. In return, the blockchain distributes rewards to participants.

These rewards act as an incentive for people to stake their assets, helping keep the network stable and secure. They are typically paid in the same cryptocurrency that was staked.

 

Understanding Staking rewards

Staking rewards are usually expressed as an Annual Percentage Yield (APY).

APY represents an estimate of the rewards that could be earned over a year if conditions remained the same. However, staking rewards are not fixed.

Reward rates can change depending on factors such as:

• Network demand

• The number of participants staking

• The blockchain’s reward schedule

Because of this, staking rewards rates may increase or decrease over time.

Rewards are typically paid out periodically and are usually distributed in the same cryptocurrency that is staked.

 

Unstaking and Unbonding periods

When you decide to stop staking your assets, they may not become available immediately.

Some blockchains require a waiting period before unstaked assets can be transferred or traded. This is known as an unbonding period.

The length of this period varies depending on the blockchain.

During this time, assets are in the process of being released from staking and may temporarily remain unavailable.

It’s important to know that this waiting period is set by the blockchain protocol itself.

 

Which crypto assets can be staked?

Not every cryptocurrency supports staking.

Only blockchains that use Proof-of-Stake systems allow their tokens to be staked. Some well-known cryptocurrencies do not currently support staking, including XRP.

You can view the cryptocurrencies that are currently supported for staking here.

 

Risks and considerations

As with any crypto activity, there are a few things to understand before staking.

Staking reward rates can fluctuate depending on network conditions. The value of the cryptocurrency itself can also rise or fall.

Some staking methods may also involve temporary lock-up periods or unbonding periods before assets become available again.

Understanding these factors can help you decide whether staking fits your investment approach.

 

Staking on Uphold

Staking directly on a blockchain can involve technical setup and ongoing management.

Uphold simplifies this process by handling the underlying infrastructure, allowing customers to earn rewards on supported assets without needing to manage validators or network operations.

You can choose between different staking options depending on how you prefer to earn rewards.

To learn more, see our guide explaining the difference between Flexible Staking and Boosted Staking.

 

Start earning Staking rewards

Staking allows supported cryptocurrencies to generate rewards while you hold them.

Instead of sitting idle, eligible assets can help support the blockchain network and earn rewards in return.

You can explore staking options in the Uphold app to start earning rewards on supported assets.

• Choose Flexible to keep your options open.

• Choose Boosted to maximize your “stack.”

Don’t let your crypto sit idle.
Start Staking Now