Staking is a process that allows you to participate in securing a blockchain network by "locking" your tokens in a dedicated wallet.
In return, you receive rewards in the form of new tokens.
To learn more about how Staking works, feel free to read our article:
> Discover Staking or how to earn rewards passively
At Coinhouse, we apply the calculation method "Guaranteed Rate".
We do not display an indicative rate but the actual rate applied when you stake your crypto assets.
Here's how staking is calculated and how annual returns may vary:
The staking calculation depends on several factors:
- Amount of tokens staked: The more tokens you stake, the higher the potential rewards.
- Staking duration: Some protocols offer higher returns if you stake your tokens for a longer period.
- Annual reward rate (APY - Annual Percentage Yield): This rate is defined by the protocol and may vary based on the demand and supply of staked tokens.
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Network participation: Rewards are often proportional to your share of tokens in relation to the total number of tokens staked in the network.
You know exactly the rate that will be applied to you without relying on calculations or research on your side.
Example:Real blockchain rate: 9.7%
Guaranteed rate: 9%No calculation needed, the rate you will receive is the guaranteed rate, which is 9%!
The annual yield may vary daily, leading to daily reward distributions.
If I place my funds today before 12 PM
My interests will be calculated from today 12:00 PM to tomorrow 12:00 PM, and will be distributed tomorrow at 12:00 PM.
If I place my funds today after 12 PM
My interests will be calculated from tomorrow 12:00 PM to the day after tomorrow 12:00 PM, and will be distributed the day after tomorrow at 12:00 PM.
Simplified Formula:
Annual yields (APY) can vary based on several factors:
- Total number of tokens staked in the network: If many people stake their tokens, the rewards are distributed among a larger number of participants, which may reduce the individual yield.
- Protocol policy: Some protocols regularly adjust their APY to encourage or discourage staking based on their needs.
- Token inflation: If the protocol issues new tokens to reward stakers, this can dilute the value of existing tokens.
The token price when you invest does not directly affect the staking rewards calculation, as they are typically expressed as a percentage of the staked amount. However, it may influence the euro value of your rewards. Additionally, since funds are locked for a certain period, it has a significant impact on market prices, as it reduces the amount of tokens available in the market.
- If the token price increases after you start staking, the value of your rewards (in euros) will also increase.
- Conversely, if the token price decreases, the value of your rewards will decrease.
For example:
You stake 1,000 tokens at €10 each (i.e., €10,000 invested):
If the token price increases to €20, the euro value of your rewards