What is staking?
Staking is the act of locking up a cryptocurrency to receive rewards. It helps verify network transactions and secure the operations of a blockchain network using the Proof of Stake consensus mechanism.
Staking in Cudos can happen directly, via validators, or by anyone in the form of delegation to those validators. The CUDOS are ‘at stake’ allowing the network to self-correct and penalise any minority attempts to defraud the chain (by altering or censoring transactions).
How to benefit from staking
The network’s health depends on your help as a Validator or staker. You help us identify dangerous
or harmful behaviours early. To say thank you, we give you standard and one-off additional rewards:
Where do the rewards come from?
Rewards come from our network’s emission schedule, which follows a curve over time up until we reach the maximum token supply of 10 billion CUDOS, ~10 years after the initial CUDOS launch.
Rewards are also allocated to stakers for each block containing transactions, this transaction fee is paid by the users of the network as a ‘gas fee’. As we roll out compute products there will be more utilisation of the chain and hence more rewards available to validators.
Staking & security
When a validator goes offline for an extended period of time or behaves in an abnormal way, it is punished for that behaviour with a percentage of its tokens being forfeited, including the tokens of all its delegators. This is a protocol-level feature needed to ensure the security and health of the network.
When choosing a validator to delegate your stake too, you can filter by the condition of the server’s uptime and reliability, and the percentage of commission. We encourage delegators to do their own research before selecting a node to delegate stake to; to mitigate the risk you can delegate your stake to multiple validators.
How to stake CUDOS?
First, get native CUDOS.
If you already have the ERC-20 CUDOS you can transfer them using the Cudos bridge.
Go to the Cudos dashboard and click ‘connect Keplr wallet’. Login to your Keplr wallet using the browser extension you set up earlier.
Send your CUDOS balance from AscendEX to your Cudos wallet address. Open the Keplr browser extension, select the CudosNetwork, and check that your funds have arrived.
Navigate back to the Cudos Dashboard and select the ‘Staking’ tab from the menu on the left.
Confirm your account address is correct and specify the amount of CUDOS you wish to delegate, then click ‘Submit’.
Approve the transaction fees. Congratulations, you have successfully delegated your stake to a validator and are now earning rewards.
