About the Stake

What is the Stake in a Validator Node?

Stake consists of delegating your tokens to a validator node that participates in the validation of transactions and the maintenance of the blockchain network. When you delegate your tokens, you are not actually handing them over to anyone. You remain the owner of your tokens and have full control over them. There is no third-party custody, which means that your tokens cannot be transferred or used without your permission. They are safe in your wallet.

How to Stake?

Requirements for Staking:

1. Wallet: You need a wallet compatible with the blockchain on which you wish to stake. This wallet must be secure and reliable.
2. Tokens: You must have tokens of the specific blockchain you want to delegate.
3. Internet Connection: A stable internet connection to access the network and perform the necessary transactions.

General Steps for Staking:

1. Select a Validator Node: Choose a reliable and secure validator node like Cumulo to delegate your tokens.
2. Connect Your Wallet: Access your wallet and connect to the corresponding blockchain.
3. Select the Stake Option: Within the wallet, look for the "Stake" or "Delegate" option.
4. Choose the Validator: Select Cumulo as your preferred validator.
5. Enter the Amount of Tokens: Specify how many tokens you want to delegate.
6. Confirm the Transaction: Review the details and confirm the transaction.

Stake Conditions:

1. Lockup Period:
   • When you delegate your tokens, they will be locked for a specific period. This period varies depending on the blockchain and the validator you choose.
   • During the lockup period, you cannot use, transfer, or exchange these tokens, but you remain the owner.
2. Minimum Stake Requirements:
   • Some blockchains have a minimum amount of tokens required to stake. Make sure to meet this requirement before attempting to delegate your tokens.
3. Fees and Commissions:
   • Validators typically charge a small commission on the rewards generated. This commission varies by validator and should be considered when calculating your earnings.
4. Validator Availability:
   • The availability and performance of the validator are crucial. Validators with high availability and good performance usually generate more rewards.
5. Unlock Delay:
   • Once you decide to withdraw your tokens from staking, there is a waiting period (unbonding period) before you can use them again. This period can range from a few days to several weeks.

Consequences of Staking:

1. Earnings and Rewards:
   • By delegating your tokens, you participate in transaction validation and network maintenance, earning additional rewards in the form of tokens.
   • Rewards are calculated based on the amount of delegated tokens and the validator's performance.
2. Risk of Slash:
   • "Slashing" is a penalty that occurs if the validator makes serious errors or acts maliciously. Part of the delegated tokens can be confiscated as a penalty.
   • It is important to choose trustworthy validators with a history of good behavior to minimize this risk.
3. Contribution to Network Security:
   • By staking, you contribute to the security and decentralization of the blockchain network. This helps protect the network against attacks and failures.
4. Influence on Governance:
   • Delegating tokens can also give you the right to vote on network governance decisions. This means you can have a say in the direction and future development of the blockchain.
5. Effect on Liquidity:
   • While your tokens are staked, they are not liquid and cannot be used for other investments or transactions. It is important to consider this aspect when planning your finances.

Advantages of Staking:

• Passive Income Generation: Increase your token holdings without needing to buy them, simply by staking them.
• Security: Your tokens remain in your wallet and under your control, eliminating the risk of third-party custody.
• Support for the Network: Contribute to the stability and security of the blockchain network, benefiting the entire community.

Decentralization Matters

The main reason to delegate to multiple validators and distribute the staking amount is security. Decentralization is security in blockchain. Concentrating all staking in a few nodes is not healthy for the blockchain, as it concentrates voting and staking power in a single node, reducing the security of the entire network.

Start Delegating

Don't miss this opportunity to maximize your earnings and delegate your tokens with us at Cumulo! Our team will be happy to guide you through the process and answer any questions you may have. Join our community of successful delegators today and take your investments to the next level!