Why Stake and How it Works
Stakers secure the blockchain by staking, or delegating tokens to validators, who participate in consensus and validate transactions. Rewards are earned for performing network operations and staked funds may be slashed for unavailability or malicious behavior.
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Delegation
Stakers sign a transaction with their private key that bonds, or delegates their tokens to a validator node.
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Participation
Validators perform network operations such as participating in consensus or signing in distributed signing groups.
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Earning Rewards
Inflation-funded block rewards and network-based transaction fees are earned in return for good validator performance.
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Slashing
Staked funds are placed at risk and can be penalized, or slashed if a validator node is unavailable or acts maliciously.