Staking Tezos with Ledger Live

Earn money while holding Tezos (XTZ)

Staking is the process of holding funds in a cryptocurrency wallet to support the operations of a blockchain network and, in return, holders are rewarded for their contribution. This can be compared to earning interest in a traditional bank.

Tezos is a multi-purpose blockchain which uses a Proof-of-Stake protocol to secure its network. Token holders can delegate their accounts to a validator, who will be in charge of securing the network on their behalf. The user may then earn the rewards generated minus validator’s fees.

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Staking Tezos with Ledger Live
Rewards

Rewards

When staking, you can earn a passive income by participating in the Tezos network via delegation.

The current annual yield on Tezos is around 6%, minus a validator’s fees. You can use Staking Reward’s calculator to estimate your monthly earnings.

When you first start delegating, it will take roughly five weeks for you to receive your first rewards from your validator. After this, you can expect rewards about every 3 days.


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Why stake Tezos assets

Delegation

In Tezos, the current consensus mechanism is known as Liquid Proof-of-Stake (LPoS). Token holders can delegate their validation rights to other token holders (called validators) without transferring ownership of their tokens. Contrary to other DPoS protocol, in Tezos you delegate your whole account.

Liquidity

When delegating, your XTZ are completely liquid. You are free to move your tokens anytime as there are no freezing periods when delegating to a validator.

No risks

There are no direct risks of delegating XTZ. The only risk you take is not earning the potential rewards. Carefully choose your validator to ensure quality of service and rewards.

Staking Tezos with Ledger Live

Step 1

Select the Tezos account you want to delegate in Ledger Live

Step 2

Choose your validator (baker) by comparing estimated reward rate

Step 3

Verify and confirm delegation information on your Ledger hardware wallet

Different ways to earn Tezos rewards:

BEGINNER

Delegate your staking power:

Tezos token holders who are not interested in being a baker themselves can “delegate” their tokens to a validator to bake on their behalf.

When performing a delegation operation, you only send your baking rights to a validator: your XTZ stay on your wallet and remain yours.

As you retain ownership of your assets, you can keep your XTZ on your hardware wallet while staking via delegation. This is the best way to keep your assets safe.

ADVANCED

Baking on your own:

You can bake on your own by setting up a node and having at least 8.000 XTZ (8.000 XTZ is called a « roll »).

Baking yourself requires you to run a Tezos node, a baker & endorser client. You should have a reliable Internet connection and high-availability servers.

The more delegated funds a baker receives, the greater the chance it has to produce blocks and earn rewards.

What is Tezos?

In August 2014, a white paper titled « Tezos — a self-amending crypto ledger » was released under the pseudonym ‘L.M. Goodman.’ Detailing an innovative method of on-chain governance where a permissionless community of users controls the direction of the network, based on proof-of-stake (PoS) consensus, Tezos generated significant buzz in the broader cryptocurrency community.


Frequently Asked Questions

You will have to wait roughly five weeks for your first rewards.
• It takes 21 days (7 cycles) until your XTZs are eligible to earn rewards
• Then you need to wait another 15 days (5 cycles) until they become liquid and can be paid out.
• After the initial waiting period of five weeks, you can expect payout every cycle (~ 3 days).

The difference between Bitcoin & Tezos is that the validation capacity depends on the amount of delegated tezos and not on the hardware calculation power like Bitcoin mining process.

Delegating Tezos is safe. The user keeps control over his private keys and never loose ownership over the assets. Delegating your assets from an hardware wallet provides you with another layer of unbreakable security.

Once you delegate Tezos assets, you are participating in the proof-of stake mechanism. For assisting in this, you get part of the rewards provided by the protocol. If you are planning to hold on to XTZs for some time, delegating will help you accumulate more XTZs while contributing to the network.