First, what is Cosmos? Also known as the "Internet of Networks", Cosmos is a network that allows the connection and exchange of tokens and data between different networks thanks to the IBC (Inter-Blockchain Communication) protocol.
The network is called Cosmos Hub, and is based on the Proof-of-Stake (PoS) consensus protocol, so staking plays a very important role in the security of the network. Through staking, they not only increase the decentralization and security of the network, but also the economic stability of the Cosmos project.
What do you need to know before you start staking Cosmos?
While your tokens are staked, they are in your custody, but they remain locked.
It is not an autocompound staking, i.e. in order to get more profit from your staking, you can claim the rewards and re-delegate them. Autocompounding is a process where this procedure is done automatically.
The unbonding period is 21 days, so you will have to wait 21 days from the time you remove your tokens from staking until you can trade them again.
Available wallets for Cosmos staking: Keplr, Cosmostation
Approximate annual APR on Stakely: 19.32%.
ATOM Staking: step by step
Let's start this Cosmos staking guide!
Step 1. Install the Keplr Wallet extension
In this tutorial, we will delegate ATOM using the Keplr wallet. To do this, install the extension from the Chrome store. Once installed, create a wallet from scratch or import an existing one; you can do this using Ledger, with the Cosmos Ledger App open, or using your seed phrase. If you're not entirely familiar with this type of wallet, Keplr is to Cosmos what Metamask is to Ethereum, a decentralized wallet that allows you to keep your tokens in your custody from any of the networks belonging to the Cosmos ecosystem.
If you create a new account, follow the on-screen instructions and store your seed phrase in a safe place. If you lose it, you will have no other way to recover it and you could lose the funds in your wallet.
Step 2. Fund your wallet with ATOM
Once you have created your Keplr wallet, click on the extension and select the Cosmos network from the dropdown at the top of the window. Then select the Deposit button to send your ATOM tokens to your wallet. A window will open with a QR code, send your ATOM tokens to the address that will appear when you scan this code.
Step 3. Choose a validator to delegate ATOM
Go to the Keplr web wallet and select Cosmos from the side menu. This will open a dropdown where you can choose between Stake and Governance; select Stake. Next, choose a validator from the list of active validators.
Find Stakely and click Manage. A pop-up window will open with the validator's information and the node's commission. This commission will be taken from the total rewards you earn for staking ATOM.
To continue, you will need to click on Delegate and enter the amount of ATOM tokens you want to delegate. Remember! ATOM staking has an unbonding period of 21 days, so if you later want to cancel your staking, you will have to wait 21 days to unlock your cryptocurrencies. Click on Delegate again and select "Average" to confirm your transaction at 0 cost.
Congratulations, you are now part of the ATOM family of stakers!
Step 4. Monitor and manage your staking
Once you have completed the delegation process, your staking will start to generate rewards that will accumulate automatically. As long as you have your wallet connected, you can monitor your rewards and manage your staking at the top of the Keplr Wallet Web page.
To claim your reward tokens, you can click on Claim. You just need to approve the transaction in order to transfer the tokens from the platform to your wallet. Once you have claimed the tokens, you can delegate them again to continue earning more rewards.
From this section, you can also choose whether to delegate your tokens to another validator, which does not require an unbonding period, or to take your tokens out of staking and start the 21-day waiting period.
For more information about Cosmos, you can consult the Cosmos staking section on Stakely or our tutorial on how to stake Cosmos (ATOM) on Keplr, where you can follow each of the steps detailed here in more detail.
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