Staking is one of the most popular ways to earn passive income in crypto — but how does it actually work? In simple terms, proof-of-stake networks like Ethereum and Solana pay token holders to help validate transactions and secure the blockchain.
You “stake” your tokens by locking them with a validator, either directly or through a staking service. In return, you earn a share of network rewards, typically expressed as an annual percentage yield.
The risks matter too: staked tokens can be “slashed” if a validator misbehaves, prices can fall while your tokens are locked, and yields are never guaranteed. As with everything in crypto, understand the trade-offs before you commit a single coin.
