--- title: "What Is Staking in Crypto?" term: "Staking" type: glossary_term canonical: https://www.moonwire.org/insights/glossary/staking.html --- # What Is Staking in Crypto? > Committing coins to help secure a proof-of-stake blockchain, in return for a share of the rewards the network pays validators. Rewards are paid in the staked coin, and misbehaviour can be penalised by slashing. **Staking** is committing a cryptocurrency to help secure a proof-of-stake blockchain, in exchange for a share of the rewards that network pays for the work. Where proof of work has miners spend electricity to win the right to add a block, a proof-of-stake network selects validators in proportion to the coins they have committed. A validator that signs correctly earns rewards; one that goes offline or signs conflicting blocks can be penalised and lose part of its stake, a penalty called slashing. ## The shapes it takes - **Solo staking.** The holder runs validator software and keeps the keys. Ethereum sets the stake for one validator at 32 ETH. - **Pooled or liquid staking.** Holders combine coins through a service; some services issue a token representing the staked position, which can move while the underlying coins stay committed. - **Custodial staking.** An exchange or custodian stakes on the holder's behalf and passes on a portion of the reward. The same trade-off runs through all three: less operational work, more counterparty exposure. Only solo staking leaves the keys with the holder - see [self-custody](https://www.moonwire.org/insights/glossary/self-custody.md). ## A reward rate is not a yield Staking rewards are paid in the coin that was staked. If that coin falls further than the rewards accrue, the position is worth less in dollar terms despite having earned. The rate itself moves with how much total stake is competing for the same rewards, and entering or leaving the validator set can involve a queue during which the coins are neither tradable nor earning. ## How MoonWire treats it In our coverage staking usually arrives as a question about wrappers: when a regulated product holds a proof-of-stake asset, how much of the staking reward reaches the end holder? Our [July state of the market](/insights/state-of-market-2026-07.html) recorded exchange-traded products listed at a 0.14% sponsor fee with staking rewards attached, and an [August pulse](/insights/market-pulse-2026-08-25.html) noted a Solana staking ETF trading over 108 million USD in a single session. Related reading sits under [crypto ETFs](/insights/topics/crypto-etfs.html). ## What it is not Staking is not a deposit, not insured, and not a recommendation. It is participation in a network's consensus process, with rewards and penalties set by that network's rules. ## Further reading - [Wikipedia: Proof of stake](https://en.wikipedia.org/wiki/Proof_of_stake) - [ethereum.org: Staking](https://ethereum.org/en/staking/) ## Where this appears in MoonWire analysis - [Three Chains Prepped for Quantum Attacks. A Weak Random Number Broke First.](https://www.moonwire.org/insights/state-of-market-2026-08.md) — Sep 14, 2026 - [Three Bitcoin Reads Waited on a Level. The Conviction Was in Fee Revenue.](https://www.moonwire.org/insights/market-pulse-2026-08-25.md) — Aug 25, 2026 - [Choppy holds, breadth splits down the middle, and two calls resolve against us](https://www.moonwire.org/insights/prognosis-daily-2026-08-16.md) — Aug 16, 2026 - [ETF Flows Round-Tripped in July. The Institutions Came for the Rails.](https://www.moonwire.org/insights/state-of-market-2026-07.md) — Aug 15, 2026 - [Money-Market Funds and the S&P 500 Moved Onto Crypto Rails. The Same Day, Self-Custody's Loss Count Passed $100 Million.](https://www.moonwire.org/insights/market-pulse-2026-08-04.md) — Aug 5, 2026 - [Source Spotlight - CrediBULL Crypto, Week of July 28: A Week About Liquidity, Just Not the Central Bank Kind](https://www.moonwire.org/insights/source-spotlight-credibull-2026-08-03.md) — Aug 4, 2026 - [Strategy Sold Bitcoin to Pay a Dividend, and Saylor Separated His Coins From the Company's](https://www.moonwire.org/insights/market-pulse-2026-08-03.md) — Aug 4, 2026 - [Market Pulse - July 29: Cash Has Out-Earned Crypto's Carry Trade for 157 Days. The Fed Just Left the Cash Leg Where It Was.](https://www.moonwire.org/insights/market-pulse-2026-07-29.md) — Jul 29, 2026 - [Market Pulse - July 28: Two Tokens Offered Their Holders Equity. The Same Day, Wall Street Listed Two New Ways to Own Tokens.](https://www.moonwire.org/insights/market-pulse-2026-07-28.md) — Jul 28, 2026 - [Source Spotlight - Ansem, Week of July 21: Seven Days on Solana's App Layer, and Not One Mention of the Closures](https://www.moonwire.org/insights/source-spotlight-ansem-2026-07-27.md) — Jul 28, 2026 - [Market Pulse - July 16: New Money Arrived. The Oldest Owners Sold It the Coins.](https://www.moonwire.org/insights/market-pulse-2026-07-16.md) — Jul 17, 2026 - [What Is a Bitcoin Treasury Company? The Premium That Powers the Model, and the Stress Test It Just Faced](https://www.moonwire.org/insights/what-is-a-bitcoin-treasury-company.md) — Jun 30, 2026 --- *MoonWire surfaces and summarizes public crypto news.* **General information only — not financial advice.** MoonWire Ltd. is not licensed by ASIC and holds no AFSL. 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