Starknet Staking is Coming - What You Need to Know

Staking on Starknet is a major milestone, marking a new era for the network. If you're eager to learn what it means and how you can participate, you're in the right place. Here’s a quick guide to everything you need to know about staking on Starknet, launching this October.

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Recap

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As part of Starknet’s 2024 Roadmap, the community introduced SNIP 18 proposal titled Staking’s First Stage on Starknet, followed by Starknet’s Staking Voting Proposal scheduled to proceed to an official vote on Starknet’s Governance hub from September 9-13, 2024.

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1. What Is Staking on Starknet?

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Staking involves locking STRK tokens to earn rewards. The initial implementation of staking involves locking your STRK tokens into a staking contract or to a Delegation Pooling Contract to earn rewards. This adds a new utility to STRK, which is already used for gas fees and governance. There are two ways STRK holders can participate:

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• As a Staker: You'll need to run a full node to validate transactions and maintain the network.
• As a Delegator: You can delegate your STRK tokens to an existing full node, allowing them to earn you rewards on your behalf without the need to run the node yourself.

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2. Phased Implementation of Staking

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Support for Staking on Starknet is the result of gradual implementation of Starknet's vision to a reliable PoS model. By adopting a step-by-step approach, the ecosystem can gather valuable data, perform crucial tests, and thus refine the staking protocol while leaving room for improvements. This first incremental implementation aims to do the following:

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• Identify a proven set of sequencers that reliably produce and attest blocks which can ensure the network’s stability and performance.
• Test the proposal’s initial economic incentive structure, including Starknet’s Sustainable Inflation Rate’s efficacy in balancing and incentivizing staking participation.
• Testing key smart contract components.

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3. How to Stake STRK on Mainnet Once Live

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When staking goes live, you can participate as either a Staker or a Delegator:

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• Stakers will need to provide a minimum stake of 20,000 STRK tokens.
• Delegators can delegate their STRK tokens to a specific staker through various supported dApp UIs including explorers, wallets, etc, with no minimum amount of STRK tokens required.

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Note: During the initial phase, StarkWare, the Foundation, and locked tokens cannot participate.

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4. STRK Rewards and Distribution

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Stakers and Delegators earn rewards based on the amount of STRK staked and the reward-sharing constant set by the Staker. The Starknet Minting Curve governs rewards by balancing inflation and token availability. The key components of the Minting Curve include:

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• More STRK locked= higher inflation, lower rewards.
• Less STRK locked= lower inflation, higher rewards.
• Inflation being capped between 1.8% and 2.5%.

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This proposed mechanism aims to incentivize participation in staking without causing excessive inflation, while ensuring that a significant portion of STRK remains available for DeFi activities and fee payments.

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5. Lockup Period

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For Stakers: There is a 21-day lockup when unstaking, during which stakers won't earn rewards or access their tokens.

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For Delegators: Delegators can switch delegates without a lockup, promoting a competitive delegation market.

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Hint: Since there is a lockup period for STRK stakers, there have been reports suggesting several teams are developing LST products on top STRK staking allowing simultaneous participation in staking and Starknet DeFi.

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6. Launch Timeline

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The launch of staking is just around the corner:

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• Testnet: September 2024
• Mainnet: October 2024

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Stay tuned for more updates, as we explore additional phases of Starknet Staking including the introduction of voting power, block attestation, and UI improvements

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For more details, check out Starknet’s official community post.

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