The Paris proposal has introduced a new role in the Tezos ecosystem—the staker—alongside the existing roles of delegate (baker) and delegator. Previously, Tezos only offered delegation, where users could delegate their funds to a baker without freezing them. However, with the recent protocol upgrade, classic non-custodial staking has been introduced as a new option.
Staking means that stakers contribute to their chosen baker’s security deposit without transferring custody of their funds. In return, they receive a proportional share of rewards, which are automatically distributed by the Tezos protocol. Unlike liquid delegation, staked funds are frozen and subject to slashing, reinforcing their role in enhancing network security.
Delegation in Tezos Protocol, unlike staking, offers a way to contribute to a baker’s stake without freezing your funds or exposing them to the risk of slashing. However, delegated funds are only half as effective in earning baking rights, rewards, and governance voting. Additionally, rewards from delegated funds are paid to the baker, who then decides on their redistribution.
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