Klaytn has gained substantial recognition for its robust infrastructure and innovative features. As an integral part of the Klaytn ecosystem, staking Klaytn (KLAY) allows users to actively contribute to the network's security while earning rewards in return. With the growing interest in staking KLAY, more individuals are embracing this method to generate passive income and contribute to the expansion of the Klaytn network.
In this comprehensive guide, we will delve into the key aspects of staking Klaytn, including its functionality, benefits, and the steps required to start staking. By the end of this article, you will have a clear understanding of how to stake Klaytn and leverage this rewarding opportunity.
WHAT IS KLAYTN BLOCKCHAIN?
The Klaytn blockchain is an innovative and robust platform that is transforming the way we perceive and utilize decentralized networks. Spearheaded by Ground X, a subsidiary of the South Korean internet giant Kakao, Klaytn aims to drive mass adoption of blockchain technology by offering a user-friendly platform with a seamless experience.
As a high-performance blockchain, Klaytn delivers a quick and efficient platform for developers, thereby accelerating the creation and implementation of decentralized applications (dApps). With a block time of just one second and low transaction costs, Klaytn has carved out a unique space in the blockchain universe, marrying speed and efficiency without sacrificing security.
One of the distinguishing features of the Klaytn blockchain is its hybrid design, which combines the best of both public and private blockchains. This hybrid model is known as a consortium blockchain. It allows for higher scalability and privacy, making it a preferred choice for businesses and enterprises.
The Klaytn blockchain also stands out due to its token economy and unique governance model. With a commitment to incentivizing a wide range of participants, not just miners or block producers, Klaytn has designed its token economy to reward diverse contributions. The Klaytn Governance Council is a group of Core Cell Operators (CCOs). It plays a crucial role in maintaining the network's infrastructure and facilitating its growth.
KLAYTN’S KEY FEATURES
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High Performance: Klaytn's mainnet, Cypress, is designed to handle a high volume of transactions efficiently. It boasts a transaction per second (TPS) rate of 4,000, enabling fast and seamless transactions. The platform has a 1-second block generation and confirmation time, which significantly reduces the latency often experienced on other blockchain platforms.
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Low Gas Fees: The Klaytn network has a low gas price that is approximately 1/10th of Ethereum’s. This makes transactions on the network more affordable and encourages more users and developers to adopt the platform for various applications.
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Interoperability: Klaytn supports the Ethereum Virtual Machine (EVM) and can execute Solidity contracts, which enable developers to create a wide range of applications. Moreover, Klaytn offers seamless interoperability with other blockchains, including its own L2 chains. This flexibility allows for cross-chain interactions, broadening the possibilities for developers and users alike.
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Governance: The Klaytn Governance Council (GC) governs the Klaytn network. This body includes companies from various key industries, such as consumer products and retail, finance, gaming, and blockchain. Such a diversified governance structure lends credibility and stability to the network.
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Vibrant Ecosystem: The Klaytn ecosystem is highly active and continuously growing, with hundreds of third-party services being built on the network. From DeFi, NFT, and Gaming sectors, the platform is home to an estimated 11 million users and 267 partners. The network is ready to develop partnerships in various blockchain sectors, including custodial and non-custodial wallets, oracles and bridges, liquidity protocols, DeFi, enterprise, and entertainment services and solutions.
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Solid Tokenomics: Klaytn's native currency, KLAY, serves multiple purposes in the ecosystem, including paying transaction fees. The tokenomics of Klaytn are designed to support a large ecosystem and encourage network participation.
WHAT IS KLAYTN’S KLAY TOKEN?
Klaytn's native currency is KLAY, which is used for transaction fees related to smart contract creation and execution, as well as regular KLAY transfers. Initially, the tokenomics of Klaytn was designed to support a large ecosystem and exponential growth, with 66% of newly minted tokens reinvested in the ecosystem.
The funding structure of Klaytn's token economy runs in tandem with the network's block generation. Each newly issued block aggregates newly minted KLAY and the sum of transaction fees used in the block. According to KGP-6, the new distribution of the rewards takes place between 4 categories: Governance Council Block Proposer Reward (10%), Governance Council Staking Reward (50%), Community Fund (30%), and Foundation Fund (20%).
Approximately 6.4 KLAY is minted with each new block. This amounts to about 200 million KLAY minted annually. At the time of Genesis, the initial supply of KLAY was 10 billion tokens. By February 2023, accounting for an annual inflation rate of 2%, the total supply had increased to just over 11 billion tokens, with 3.073 billion KLAY in active circulation.
The Klaytn Foundation initiated a proposal known as KGP-6. This was a strategic effort to optimize Klaytn's tokenomics. A significant part of this proposal is the burning of a substantial portion of the undesignated reserve KLAY tokens. More specifically, 5.281 billion KLAY were burned. Implementing this proposal resulted in an instant reduction of the supply by 73%.
The remaining 2 billion reserve KLAY tokens have been designated as the "Klay Value Creation Reserve," a fund earmarked for exploring ecosystem opportunities. Any unused tokens in this reserve are set to be entirely burnt after 3 years if no opportunities are secured, a move that could result in the removal of approximately 66% of the total KLAY supply.
WHAT IS KLAYTN (KLAY) STAKING?
Klaytn (KLAY) staking refers to the practice of locking up KLAY in the network to assist with transaction validation and the addition of new blocks to the blockchain. By staking KLAY tokens with a reliable GC member, users contribute to the network's consensus mechanism and receive rewards in return.
The Klaytn Governance Council is a collective group of Core Cell Operators (CCOs) responsible for maintaining Core Cells, the essential infrastructure of the Klaytn ecosystem. The Klaytn Governance Council Reward mechanism has been established to incentivize these council members. It rewards the proposer of a new block with 100% of the block reward. The probability of a council member being selected as a proposer is proportional to the amount of KLAY staked by the member and their delegators, incentivizing higher levels of stake.
For those interested in KLAY staking, the procedure is straightforward. It begins with choosing a trustworthy Governance Council (GC) member, then transferring their KLAY tokens to this chosen validator. After a specified duration, owners will receive staking rewards, providing a source of passive income. This dynamic approach makes the Klaytn ecosystem an appealing choice for both crypto investors and enthusiasts. However, there is a key detail to remember: unstaking KLAY requires a waiting period of about 7 days. Once this period has passed, your tokens become available once more for transactions or for restaking.
Staking KLAY encourages users to hold their cryptocurrency rather than trade it. This practice helps to mitigate volatility and enhance the stability of KLAY in the market. Additionally, staking rewards often yield higher returns than traditional savings accounts, making it an attractive choice for individuals seeking passive income. The current APR for staking KLAY can be monitored on Klaystation.
WHERE TO STAKE KLAYTN (KLAY)?
Currently, there are 2 wallets, that support KLAY staking:
Kaikas
Kaikas is a browser extension wallet that facilitates KLAY staking through platforms such as Klaystation and Hashquark. Klaystation provides users with a variety of validators and corresponding Annual Percentage Rate (APR) values to choose from. As a Hierarchical Deterministic (HD) wallet, Kaikas offers the convenience of generating multiple accounts from a single master seed phrase. This wallet supports a range of Klaytn networks and also provides the ability to add custom tokens within the wallet. Moreover, Kaikas is designed to handle signing requests from web-based Blockchain Applications (BApps) on the Klaytn platform. To help you figure out staking with Kaikas, we've prepared a guide on How to stake KLAY using Kaikas Web Wallet.
Klip
Klip is a digital wallet created by Kakao Corp, a renowned South Korean company. At present, it's exclusively available in Korean for both iOS and Android platforms. Much like Kaikas, Klip also supports KLAY staking through the use of Klaystation. A standout feature of Klip is its smooth integration with KakaoTalk, a popular messaging app in South Korea. This integration enables users to set up a new wallet swiftly and conveniently.
A STEP-BY-STEP GUIDE TO STAKING KLAYTN (KLAY)
Step 1: Buy KLAY
Firstly, you will need a certain amount of KLAY tokens for staking. You can buy them on any of the exchanges featured on the CoinMarketCap Klaytn Markets page. Currently, there is no requirement for a minimal amount of KLAY to stake, so get as many tokens as you wish. You will also need a compatible wallet that supports KLAY and its staking functionality.
Step 2: Choose a wallet
You'll need a secure and reliable wallet to hold your KLAY tokens and participate in staking. In this guide, we'll use the Kaikas web wallet as an example. Ensure that your wallet is set up and secure before proceeding.
Step 3: Choose a GC member
The decision of which Governance Council (GC) member to delegate your tokens to is an important one. Key factors to keep an eye on include:
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The performance of the validator;
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The total amount of stake;
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Governance efforts of the validator;
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Expected Annual Percentage Return (APR);
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Commission charges;
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Social media presence and official site.
As a member of the Governance Council, Everstake sets the bar high with its outstanding security measures and transparent operations. With the support of an adept team and the use of enterprise-grade hardware, we are committed to providing optimal performance. The attractive return rates we offer have made us a preferred partner for numerous token holders.
Step 4: Transfer KLAY to your wallet
Once you've chosen a compatible wallet, the next step is to transfer your KLAY tokens into that wallet. Ensure the transaction is successful, and your tokens are visible in your wallet balance.
Step 5: Stake your tokens
Once your KLAY tokens are in your wallet, you can start the staking process. This usually involves navigating to the staking section of your wallet, entering the amount of KLAY you wish to stake, and confirming the transaction. In case you’re using Kaikas, you’ll need to go to Klaystation, connect your wallet, and stake to your desired node.
Step 6: Confirm your staking status
After initiating the staking process, it's important to confirm that your staking status is active. You can do it through your wallet or by checking a Klaytnscope explorer.
Remember, staking involves a degree of risk, as your tokens will be locked for a period of time and may be subject to changes in market conditions. Always do your own research and consider your financial situation before staking.
WHY STAKE KLAYTN (KLAY) WITH EVERSTAKE?
Everstake is renowned for providing top-tier staking services. With an experienced team of blockchain professionals and a state-of-the-art infrastructure, Everstake brings together the best of expertise and technology. This ensures that your tokens are managed effectively and securely.
One of the primary reasons to stake KLAY with Everstake is the attractive returns on staking. Everstake has consistently demonstrated a solid track record of providing impressive returns to its stakers, making it a promising avenue for those looking to maximize their KLAY holdings.
Moreover, Everstake places a heavy emphasis on security. Utilizing a host of cutting-edge security measures, Everstake ensures that your staked KLAY is well-protected. This makes Everstake an ideal choice for those who place a high value on the security of their digital assets.
Most importantly, Everstake provides comprehensive support to its users. Whether you're a seasoned blockchain enthusiast or a novice in the world of staking, Everstake's team is always ready to assist you in navigating the staking process. If you have any questions, you can reach out to our Klaytn Blockchain Manager on Twitter at any moment. This level of customer support makes staking with Everstake a seamless and user-friendly experience.
Everstake's commitment to transparency is another factor that sets it apart. With Everstake, you're always in the loop about the performance of your staked KLAY. This transparent approach builds trust and ensures that you're never left in the dark about your digital assets.
FAQ
WHAT'S THE BEST PLACE TO STAKE KLAYTN (KLAY)?
Wallets are often viewed as a secure option for staking because they enable you to maintain full control over your funds. Moreover, staking through wallets allows you to select your desired validator, providing more benefits than an exchange: enhanced security, rewards, and flexibility. We advise using Klaystation because it offers a few validators to choose from, as well as an intuitively clean and simple interface.
HOW MUCH KLAYTN (KLAY) DO YOU NEED FOR STAKING?
There are no restrictions, you can stake as much KLAY as you want.
IS STAKING CRYPTO SAFE?
The act of contributing your tokens to a validator's stake weight is known as "delegating" your tokens. It's crucial to understand that delegating your tokens to a validator doesn't grant them any ownership or control over your tokens. You retain full control over all your staked tokens, even after delegating them to a validator.
CAN I STAKE KLAYTN (KLAY) WITH EVERSTAKE?
Absolutely. For those looking to earn passive income while also bolstering the security and reliability of the Klaytn blockchain, staking KLAY with Everstake via Klaystation is a suitable choice. To calculate potential rewards and explore various KLAY staking methods with Everstake, visit this dedicated page on our website.
By opting to stake with Everstake, you can enjoy personalized support and exclusive benefits, especially if you are delegating significant token amounts. Choosing Everstake as your staking service provider allows you to enjoy a seamless staking experience while also contributing to the growth and protection of the Klaytn network.
HOW TO GET KLAYTN (KLAY) TOKENS?
You can acquire Klaytn (KLAY) tokens by purchasing them on a cryptocurrency exchange, earning rewards through staking, or other token receiving methods.
HOW TO UNSTAKE KLAYTN (KLAY)?
To unstake Klaytn (KLAY) tokens, you need to access your staking account on the Klaytn network and initiate an unstaking transaction. The process may vary based on the staking service provider you use, but generally, you need to submit a request to unstake your tokens, wait for the unstaking period to finish, and then claim your tokens once they are available. The unstaking period typically lasts for one week, during which your tokens are locked up, and you cannot use them. Once the unstaking process is complete, you can freely transfer or sell your KLAY tokens.
