What is Tezos?
Tezos is an open-source platform for assets and applications that can evolve by upgrading itself. Stakeholders govern upgrades to the core protocol, including upgrades to the amendment process itself.
More information: https://tezos.com/get-started#intro-basics
What is Baking?
“Baking” is the act of signing and publishing blocks to the Tezos blockchain. Bakers are a crucial component of the PoS consensus mechanism by ensuring that all transactions in a block are correct, that the order of transactions is agreed upon, and that no double-spending has occurred. Bakers validate all transactions and add them to the blockchain and get rewarded with additional tez in that process.
For more information regarding Tezos bakers, you can check:
What is Liquid Proof-of-Stake?
Tezos allows token holders to transfer (“delegate”) validation rights to other token holders without transferring ownership. The entire balance will always be Staked or Delegated to the desired Baker. Your balance can be transferred at any time and it is not locked. And that is why Tezos’ consensus mechanism is referred to as “Liquid Proof-of-Stake” or “LPOS”.
When Do I Get Staking Rewards?
Rewards are distributed on every cycle after the tez amount has been unfrozen by the Tezos Network. Unfreezing of the rewards take 7 cycles. 1 cycle is equal to 4,096 blocks, which is roughly around 3 days. The bakers are the ones who receive the unfrozen rewards. And the rewards distribution frequency are dependent on the Baker you selected.
In simple terms, it takes at least 21 days before you start receiving rewards. The baker has to take their commission first and then does the distribution after.
Let’s start Baking some Tezos
Step 1 - Preparing your XTZ tokens
Get XTZ from exchanges and deposit it to your Tezos Wallet. Open it up to confirm that your balance is showing correctly. Alternatively, from the main wallet screen go to the Finance tab to see all available tokens that can be staked on your Trust Wallet. You will see here Tezos (XTZ), tap on it to go directly to the Tezos Wallet.
If you do not see XTZ on your wallet, Tap the “+” sign on the upper right and search for XTZ, then use the toggle to add the token.
Step 2 - Access the Staking Menu
Tap on More to access the Staking Menu. You will see here the following options:
- Stake Details - View more information about staking Tezos and your current staking status.
- Stake - This will take you to the initial staking screen.
- Unstake - Go here if you want to unstake your tokens and stop getting rewards.
To start the staking process, tap on Stake.
Step 3 - Choosing a Validator
Tap on Validator to see the entire list of Tezos Bakers. Chose your desired Validator, then tap on Next. No need to input anything on the XTZ amount. This will always be set to the maximum amount.
With Tezos protocol, the entire balance will always be Staked or Delegated to the desired Baker. Your balance can still be transferred at any time and it is not locked.
Step 4 - Send Transaction to the Network
Review the transaction details. Tap on Send when you are ready to proceed,.
The screen will automatically go back to the XTZ wallet. A Pending message will appear while the network confirms the transaction.
Step 5 - Confirming the Transaction
Once the staking process is complete, you can verify the results by tapping on More and then tap on Stake Details. Also, on the main Tezos Wallet screen, you can already see here the Available and Staked tokens. Congratulations, you are now staking your XTZ tokens.
How to Check the Tezos Blockchain Explorer
You can view your staking status by going to this explorer: https://tzstats.com/ and then do a search for your Tezos address. You will notice that the Spendable Balance is just the same as the Total Balance. This is because Tezos protocol is a “Liquid Proof-of-Stake” which means that your funds are not locked. The screenshot also shows that the address is already Delegated(Staking), see Current Delegate on the right.