Understanding the New Tezos (XTZ) Staker Role: A Comprehensive Guide
In the latest and one of the most significant upgrades of the Tezos protocol, known as ParisB, a new staking role has been introduced. This new role has left many people puzzled about what it is, how it functions, and how it differs from the previous staking mechanism.
In this article, the new staker role in Tezos is demystified, guiding users through the process of becoming a staker. According to Tezos Spotlight, understanding the new staking role requires a grasp of how Tezos staking worked up until now.
Staking Options Before Adaptive Issuance
Until recently, Tezos offered two main options for staking: Baking and Delegating.
- Baking: Validators, known as bakers, need to run appropriate software and maintain a staking balance of at least 6,000 tez. Bakers create and verify blocks and are required to lock their tez as security bonds. Fraudulent activities result in slashing, but if the software is run as suggested, the risk is minimal.
- Delegating: Delegators can delegate their tez baking rights to another baker, increasing the baker’s staking balance and helping them secure more blocks. Delegators receive rewards minus a small fee retained by the baker. Delegated tez remain in the wallet and are always liquid, posing zero risk.
The New “Staker” Role — Best of Both Worlds
The recent ParisB upgrade introduced a third role: the “Staker.” This role combines traits of both bakers and delegators.
As a Staker, users choose to stake their coins with another baker. The tez remain in the wallet but are locked, with a wait time of approximately 11 days to become liquid again if unstaked. Staking tez actively participates in the chain’s security, posing a tiny risk of slashing if the baker misbehaves.
Despite the minimal risk, staking offers double the rewards compared to delegating. Rewards are sent directly to stakers from the protocol. Stakers can also stake a portion of their wallet while the rest of the tez remains delegated and liquid.
The Boogeyman: Slashing
Slashing remains a concern for many tez holders. However, since the start of the Tezos mainnet, slashing has occurred in only 0.003% of blocks. Slashing occurs when a baker commits “double signing,” such as running two setups and attempting to bake or attest the same block from both instances. If bakers use the recommended software, the risk is virtually zero.
Select a Baker
The first step to staking is choosing a baker. Not all bakers accept external staking, so it’s crucial to find one that does. Tools like xtzchad.xyz provide comprehensive lists of bakers who have enabled external staking. It’s advisable to choose a baker active in the community and easy to contact.
Delegate -> Stake -> Earn
After choosing a baker, the next steps involve connecting a wallet, delegating to the baker, and staking the tez. Many Tezos wallets have built-in staking buttons, and universal options work with any Tezos wallet.
Step 1 — Connect Your Wallet
Connect the wallet using options like Beacon for wallets such as Kukai, Temple, Trust Wallet, or Ledger for Ledger devices.
Step 2 — (Re)Delegate to a Baker
If not already delegated to the chosen baker, click on the “Change Delegate” button, paste the baker’s address, click delegate, and confirm the transaction with the wallet.
Step 3 — Stake and Earn!
After delegating, click on the “Stake” button, choose the amount of tez to stake, and confirm the transaction. Staked tez will start earning rewards. When unstaking, the tez will remain locked for approximately 11 days before becoming liquid again.
Starting staking is straightforward, and with benefits like doubled rewards and increased network security, staking becomes an obvious choice for long-term Tezos holders.
Originally published at Tezos Commons News.