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Crypto staking explained

Staking means committing eligible cryptoassets to a proof-of-stake system or a service that participates in one.

How it works

Rewards generally compensate validators or delegators for helping secure the network. The exact return depends on issuance, fees, validator performance and service charges.

What to check

Check whether the user is staking directly, delegating or using a custodial product. Review lock-up, withdrawal, slashing and reward-calculation rules.

  • Identify the staking structure
  • Check lock-up and withdrawal rules
  • Separate token yield from total return

Limits and risks

A quoted staking yield is not guaranteed and can be offset by token-price declines, slashing, smart-contract failure or provider risk.

Primary sources

Bitcoin Developer Reference↗Ethereum developer documentation↗FATF: Virtual Assets↗

General information only. Investment products can lose value, and terms, fees and regulation can change.