How To Stake Solana And Earn Rewards

Forbes

25-05-2025

Staking solana comes with benefits of income generated by staking and the ability to contribute to ... More the stability of the Solana network.
Staking is the process by which a token holder delegates Solana (SOL) tokens to a validator so that the validator can participate in consensus, which determines which blocks should be added to Solana's blockchain. Validators have the ability to vote on which blocks contain valid transactions and should therefore be added to this network's blockchain.
Investors who stake solana by delegating their tokens to one or more validators can both earn rewards in the form of income for contributing their digital assets to the network's consensus and also help make the network more secure.
Generating rewards: One major benefit of staking solana is generating rewards in the form of income. The amount of income an investor receives for staking their solana depends on several variables, including how much SOL they have staked on the network and solana's inflation rate.
Network reenforcement: Solana's network is vulnerable to the impact of bad actors who could potentially submit invalid transactions to the network. By participating in staking, investors can help ensure that only blocks containing valid transactions are added on the Solana network.
Validators are nodes that vote on transactions and therefore determine which are added to Solana's blockchain. More specifically, they vote on individual blocks containing these transactions to decide whether they are acknowledged by the Solana network. To enable this process, individual investors delegate their tokens to validators, which in turn shows their faith in these particular nodes.
The more tokens investors delegate to an individual validator, the more weight that node's votes will have in terms of deciding consensus. This weight is referred to as stake-weight, and the network determines consensus by considering all votes cast in this manner. Anyone can run a validator, as long as they fulfill certain requirements. These include having adequate hardware, as well as having a certain amount of solana available to stake.
To participate in staking, you need to have a wallet that supports this function. Not all wallets support this functionality, so investors can benefit from thoroughly checking whether any wallet they are considering has this characteristic. Several hardware (or cold) wallets offer this functionality. The Ledger Nano S Plus, for example, supports solana staking. The Trezor Safe 3, Trezor Trezor Safe 5 and Trezor Model T all permit staking. There are also online (hot) wallets that permit solana staking, for example the Phantom wallet, which is self-custodial meaning that using it provides you with full control over your private keys. Solflare is another self-custodial wallet that offers solana staking. Certain exchanges, for example Kraken, let investors stake solana.
Before staking any tokens, an investor must move them from their wallet into one or more stake accounts, at which point they can delegate the tokens contained therein to a validator. Investors should keep in mind that a stake account can only be delegated to one validator at a time. In other words, if an investor wants to assign their tokens to multiple validators, they will be required to establish several stake accounts.
Investors should keep in mind that for a vote account to contribute to consensus, it needs 'a rent-exempt reserve of 0.02685864 SOL.' Past that, if a validator is in favor of a block, voting for that block requires sending a vote transaction, something that can cost as much as 1.1 SOL every day.
Staking rewards are a function of four variables. One is how much SOL an investor has delegated to staking. Another is the network's current inflation rate, which started out at 8% but is scheduled to decline 15% per year until it reaches an annual rate of 1.5%.
The third variable is the validator fee, a commission that validators charge their staking accounts every time the network issues inflationary rewards. A validator charges this fee and then the remainder of these rewards go into the staking accounts delegated to that particular validator.
The fourth variable is validator uptime, which is how often an individual validator contributes to consensus. A validator will earn a Vote Credit every time it votes for a block that is in turn added to the Solana network's blockchain. These vote credits are in turn used to determine how much every validator will earn when rewards are counted and distributed.
Before an investor can stake their SOL tokens, they need to be sure they have a wallet that allows such activity. Once an investor has attained this, they can create one (or more) stake accounts and then move your tokens to these accounts. Keep in mind that each stake account can only be delegated to a single validator, so you will have to set up multiple stake accounts if you want to stake your solana to various validators.
One popular wallet you can use to stake solana is Phantom, a self-custodial option. To stake solana using this wallet, you must use the app, select your solana balance, click on 'Start earning SOL' and then select 'Native Staking.' You can then pick out an amount of solana you want to devote to this purpose and select 'Stake.'
Another wallet you can use to stake solana is Solflare, another popular method for doing so. At the time of this writing, more than $9 billion worth of SOL was staked through this wallet, according to the Solflare website. This hot wallet is self-custodial, providing complete control of your keys, and it also provides significant flexibility when it comes to selecting a validator for staking.
To stake SOL using Solflare, there are several steps you must follow. To stake through a desktop, you must first open a browser and then select 'Access Wallet.' From there, you pick out the 'Staking' tab from the menu on the left side of the page. Next, you click on 'Stake,' determine the amount you want to use for this purpose, and then select a validator.
Keep in mind that by completing the aforementioned steps, you are delegating SOL to a validator. However, newly delegated units of SOL are not eligible to earn staking rewards right away, and they will not be able to do so until they are activated fully. These units can change their status once something called a new epoch begins. An epoch is roughly two days in length.
Selecting a validator to stake your SOL has significant implications for both you and also the broader Solana network. As an investor, this choice can mean the difference between you earning rewards in the form of commission or losing SOL. Past that, any time you stake your SOL to a validator on the Solana network, you are basically vouching for that validator since you are trusting it to safeguard your digital currency. Another way of putting it is that you are 'voting' for that particular validator and showing the broader network that you are willing to trust it.
One major factor to consider when choosing a validator is how much commission they charge on the rewards they generate by staking SOL. Investors should keep in mind that public validators charge between zero and 10% every year. SOLRealms, Solana Compass and Reflect Validator, three public validators, all charged roughly 7.35% annually at the time of this writing. Considering what is at stake, investors can benefit greatly from researching the background and reputation of any validator they are considering. Past that, it might be wise for them to stake SOL to multiple validators so as to avoid putting all their eggs into a single basket.
To stake SOL tokens, you must establish a wallet that allows such activity. There are many hot and cold wallets that support this activity, but you can benefit from double checking that any wallet you want to use can provide this functionality.
You can first obtain some SOL tokens and then transfer it to your wallet. Once again, make sure your wallet supports SOL staking.
Once the SOL tokens are in your wallet, you can figure out which validator (or validators) you want to stake your tokens to. There are many other factors you might consider when selecting a validator, including validator fees and validator uptime.
Once you have figured out which validators you want to contribute your SOL to, you can delegate the tokens in question. Remember that a stake account can only be delegated (assigned to) one validator at any given time, so if you want to delegate tokens to many validators, you will need multiple stake accounts to achieve this objective.
There are multiple ways you can track the rewards you earn by staking your SOL tokens. For example, you can use Ledger Live, the app designed for Ledger devices. With this app, you can check out this particular metric using the Earn dashboard. To do so, you select the 'Earn' tab in Ledger Live, scroll to your Solana account, which will illustrate both the rewards you have built up and how much SOL you staked to earn them.
If you want to check your staking rewards using the Phantom wallet, go to the assets tab, select the 'Solana' token, and then click on 'Your Stake.' From here, select your Stake account and proceed to check the 'Last Reward' section.
Once you have put your SOL tokens toward staking, you can unstake them, and once they are available again, you can use them however you want.
To unstake using Trezor Suite, the app for Trezor hardware devices, you start by navigating to the tab for Solana Staking and click 'Unstake.' At that point, you can determine how much of your SOL you want to remove from staking in this manner, click on 'Unstake' and then use your Trezor device to verify this particular action. At this point, you must wait for the SOL in question to become available, something that will take about one epoch. You can then select 'Claim' in the Staking tab to move your SOL to your Trezor wallet.
Unstaking SOL in the Phantom wallet is a bit simpler. In your wallet, select your solana token balance and then click on the 'Your Stake' row. Next, pick out the validator (or staking account) containing the tokens you wish to free up and then select the 'Unstake' button in the bottom right of the screen. Once you complete these tasks, you will need to wait for deactivation to occur, and then you will have the ability to move the associated funds to your wallet.
Keep in mind that you could lose any SOL put toward staking because of something called slashing. Basically, if a validator is guilty of taking certain malicious actions, the network can then punish that validator by destroying some of the SOL that validator has put aside for staking.
This has been put in place to provide validators with a valid reason to avoid taking part in such malicious activities, as slashing a validator's SOL reduces the awards it earns by participating in staking and could also cause reputational risk.
Interested parties should keep in mind that the existence of slashing can prove beneficial for investors. It gives them incentive to avoid staking their tokens to validators that might engage in malicious activities. Past that, the existence of staking gives them a good reason to avoid putting all their eggs into one basket, so to speak.
Tax treatment of SOL staking varies depending on jurisdiction. In the U.S., for example, tokens received through this process are treated as taxable income, the IRS clarified through Revenue Ruling 2023-14. The Canada Revenue Agency treats any tokens received through staking as income during the year they are received. It can prove quite helpful to maintain accurate records that include every crypto transaction you make.
It may very well be worth it for investors to stake solana. For example, crypto investors interested in generating income may take a keen interest in such opportunities. Past that, investors who are interested in contributing to the stability of the Solana network may want to take part in staking the digital token.
However, investors who are thinking about participating in staking should keep in mind that doing so will put their SOL at risk because of slashing. Any time an investor stakes their digital tokens to a solana validator, they could potentially lose it to slashing, which is something the platform uses to give validators economic incentive to avoid certain malicious activities.
Bottom Line
Investors who want to stake solana should keep in mind that it certainly comes with its benefits, specifically income generated by staking and the ability to contribute to the stability of the Solana network.
At the same time, risk is inherent to investment, and investors can potentially lose any SOL tokens they put toward staking as a result of the network taking part in slashing. Investors can benefit from conducting thorough due diligence on any validator before staking their tokens to it.
Inactive stake refers to tokens that are not contributing to the staking process and are therefore not helping make the network stable or earning rewards.
Investors who want to stake their solana need 0.01 SOL in their wallet to pay the network fee. They also need to have whatever SOL they want to contribute to staking.
Yes, it is possible to stake solana on multiple validators. In fact, the existence of slashing provides interested parties with significant incentive to do so.
Staking solana comes with risk, specifically slashing. If you stake your tokens to a validator, you could lose those digital assets should that validator take part in malicious acts.
If you want to stake solana, you will need a wallet that supports such activities. There are hardware wallets, for example Ledger and Trezor devices, that allow staking, as well as online wallets like Phantom.