Don’t Stake on ICP Until You Read This!

Why Staking on ICP Is More Complicated Than You Think

To prime you for this article, here’s staking in a nutshell: One of the most popular methods for earning cryptocurrency is by staking your tokens. This is largely because many of the leading cryptocurrencies use a consensus mechanism known as ‘proof of stake’. In this setup, users can ‘stake’ their tokens to help secure the network. In return, they are rewarded with new tokens.

Staking on ICP works a little different

The Internet Computer Protocol, often referred to as ICP, is not a “proof of stake” network. However, you can still stake your ICP tokens. By doing so, you participate in the governance of the protocol rather than its security. It’s important to note some caveats when staking your ICP tokens:

1. Neurons: A batch of staked ICP is referred to as a “neuron” by the network.
2. Eligibility: ICP, when staked, must have a “dissolve delay” of at least 6 months to vote on governance proposals.
3. Dissolve Delay: This can be set to as long as 8 years, with longer delays yielding higher APY on the staked ICP.
4. Locking: Staked ICP remains locked indefinitely until the unlocking process is initiated, at which point the dissolve delay countdown begins.
5. Voting: To earn rewards, staked ICP must participate in voting on governance proposals; no votes mean no rewards.
6. Rewards: These accumulate as something called “maturity” in a new batch of staked ICP, which can be converted to ICP when you “spawn” your rewards at a nearly 1:1 conversion rate.

These are just some of the requirements that have been in place for a couple of years now, but there is recent speculation that Dfinity (a leading contributor to ICP) is proposing some staking design changes.

We’ll release an article on this topic if it materializes.

Seems like a lot of requirements?

For a crypto user to feel secure staking their tokens on ICP, they would likely want to conduct thorough due diligence on ICP’s staking requirements. One question that arises is, where can they even start staking their tokens? Our amazing team (yes, we’re biased) is making significant progress in simplifying the entire staking process. We provide users with the tools they need to manage their staked ICP, without all the extra jargon and complex requirements. Rakeoff simplifies the requirements by:

• One-click staking: Through the Rakeoff UI, you can stake an amount of ICP and begin earning rewards in one click — all of the configuration is done automatically for you.
• Less jargon: The crypto space is full of jargon, but with Rakeoff, you’ll see familiar phrases you’re used to, such as ‘Staked ICP’ instead of ‘Neurons’ and ‘ICP rewards’ instead of ‘Maturity’.
• APY estimates and asset monitoring: Rakeoff shows users the dollar value of their assets, portfolio allocations, and APY estimates for the ICP rewards they can expect to receive — in real time. Overall, the UX is easier and more efficient for users.

Try out the dApp for yourself: https://rakeoff.io/

The landscape is evolving, and so are we

Staking can be complex, and to be honest, it’s not for complete newcomers who are unfamiliar with crypto. The process involves locking up tokens, which you’ve likely purchased with your hard-earned money — so we understand the importance of staking platforms getting it right. We’re your co-pilot in this journey, providing you with all the tools you need to navigate this space. With features like one-click staking, simplified terminology, and real-time APY estimates, we’re making it easier than ever for you to dive into the world of ICP staking and governance.

Thanks for taking the time to read our article. If it resonated with you, consider following us on Medium and Twitter. That way, you’ll always be in the loop about the latest advancements at Rakeoff and get valuable insights into ICP staking.