With the Solana hype train heating up, I thought I would take another look at Solana this time and see how their staking system is working. I saw there are some interesting diesel pools available on platforms like Orca, but I wanted to see how the staking is working.
After buying a little Solana, I transfered it to my Solflare wallet and it moved over there pretty quickly. Withdrawing from the exchanges is not so cheap, but sending and receiving is usually very cheap on Solana, which is what makes it more attractive than ETH for example.
What I like about Solana, is that it is similar to Hive and Wax in regards to staking, although it works a little different and interestingly. I prefer to stake on these chains instead of a bridge or platform as they are usually getting hacked, have some security issues or they are giving out rugs.
With Solana, you stake to a validator node of your choice, but you still retain the ownership of the staked Solana, which is important in case a node goes down or something. It can all be done easily inside your wallet too. In Solaflare, you just click staking:
From there, you can click the stake button and it brings you up the options:
You can select your validator and then it gives you details of the expected APY, which basically fluctuates based on the current inflation, amount staked and the uptime and importantly for us, the commission fee of the validator that can have a big effect on how much return we get.
A useful website that I found, gives you a list of the top validators and the fees they charge. It is called Solana Beach and can be helpful in choosing your validator. Of course high returns are important, but you also want a reliable validator and one that isn't going to keep adjusting fees etc.
Once you have found your validator that you are happy with from the list, you can type it in and click stake. It can take upto 3 days for your staked SOL to start earning rewards and it gets added on to your staked value.
Here you can see that I have staked to StakeHaus and it has a 0% fee which is pretty good. It is just outside the top 20, but should be ok. Once your staked SOL turns active in green, you start earning rewards. You can the expand the view and see your earnings easily enough.
It might sound good to earn between 7-8% on SOL, but the inflation is around 8% per year which is needed to cover the cheap transactions, so you are just standing still with your SOL here, so it could make more sense to put in a diesel pool with some higher returns. Of course, higher returns come with more risk though.
With your SOL staked, you are now ready to sit back and wait for the pump.. or dive.. depending on your point of view! 😅
Thanks for reading.
Credits:
Title image created with image from source
Solana info here.
Screenshots from Solflare Wallet unless specified.
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