IoTex Staking: the definitive guide
This morning, Iotex Core released the “staking” function on their website.
As you can see from their blog post, it’s extremely trivial to stake. You need to install Metamask (you can link Metamask to your Trezor/Ledger, it’s just a web tool), make a couple of transaction and earn up to 30% bonus.
But before you start staking… let us reveal you some important details and tricks to better stake.
WHAT IS STAKING AND WHAT REWARDS DO I GET
“Staking” means that you lock your tokens, literally that you have something “at stake”. By locking them, you lose the immediate availability of your tokens, and in exchange you get some rewards.
During this pre-main net phase the reward will be provided by the Foundation, giving you 20%/30% annualized reward. So, if you stake for 28 days+ you get about 2,5% of your tokens per month. After that, by voting for your favorite Delegate (AKA IoTexTeam :D) you will get rewards that will depend on the total staking tokens, lock-in period and other details. The tokens already staked will be used to vote.
So, if you plan to vote, it’s better to start stake: you will get bigger rewards. But wait a bit and learn more before doing something inappropriate
TIPS & TRICKS ABOUT STAKING
There are some other things that you should know about staking, before approaching metamask
- The min amount you can stake is 100 IOTX. You can create as many buckets as you like, as long as the they have at least 100 IOTX inside
- You can stake for any 14-days duration (14, 28, 42…). The longer, the higher the bonus as you can see here
- You can’t split a bucket. So if you have 10000 IOTX and you put them all together staking, you can vote just with that bucket for one delegate and one duration
- Why should you split? Because every bucket can be locked for a different amount of time, and the longer the lock-in the bigger the bonus. As you can see from the above picture, there is a strong incentive to lock for at least 28 days; your tokens will weight about 18% more, generating bigger revenues once the main net begins
- On one side, you can lock for more than 28 days. If you think that you will never sell a portion of your IOTX, you can push up to 350 days, netting you almost 33% — much more than 18%
- On the other side you can lock for less than 28 days, even 0 days if you want to have them available as soon as you want
- Don’t forget that if you stake, the unstaking operation is manual. Say that you lock your tokens for 28 days, getting a nice 18% votes. But if after 28 days you don’t do anything, the coins will still be staked and counted for basic value. So you lose the bonus while the days pass
- You can avoid that by selecting “autostake”; this will keep the coins staked for the amount of days you set. However in this case they will be locked until you decide to unstake, then you have to wait the days you set at the beginninf
- The unstaking process it’s not instant. Once you unstake coins that aren’t locked, you will be able to move them in 3 more epochs (days)
- During this 3-days your coins will be in a limbo. You can’t move them yet but they don’t vote. Call it an “anti pump&dump” feature
- You can’t unstake coins that are locked. If you decide to lock coins for 28 days, you have to wait the end of this period to unstake. You can’t do anything if you want to unstake them, say, after 14 days
- Rewards provided by Foundation or, after main net, by your delegate will NOT autostake. You need to stake them; on the other side it means that you can move or sell them if you like, so that your whole investment isn’t locked. IoTexTeam will do his best to pay as frequently as possible in order to give you the availability of your tokens
- If you lock your tokens for a very long time, the alpha phase of the main net will be probably over before your lock-in expires. Foundation will provide tools to manage that situation, so no risk in long-term lock-in (as we did!)
- All the operations right now are on the ethereum blockchain. Leave some ethereum cents (even 0.1 will be ok for months) to manage the smart contracts
Couple more FAQs that might be helpful
Is there a difference in locking the tokens for 1 year or auto-stake them for 1 year but setting 14 days as lock-in? In the end it’s always one year
There is a huge difference. Say you have 10000 tokens.
Case A: you lock for 14 days and autostake. You get about 11450 votes, and you can unstake every 14 days if you turn autostake off. If you never do that, you keep getting 11400 votes
Case B: you lock for 350 days. You get about 13210 votes, but you can’t move your IOTX for one year. However you will get bigger rewards
So if you plan to have a long-term commitment, case B is your way. If you don’t, better go for A
I set autostake and i’d like to unstake my coins. What should i do?
Deactivate autostake, wait the days you set in the beginning. After that, unstake the coins and wait 3 days
I want to change delegate and come with you
You just need to switch delegate. You can do that, but you have to move a “bucket” together. You can’t, say, split your tokens.
Should I start staking even now that I can’t vote for you while we wait March 11?
Of course you should. Even by setting 0-duration staking you will get about 20% annualized reward. It’s a great deal. And we will help you setting a proper strategy
Disclaimer: every single person should have his/her own strategy about staking, tailored to his/her own ideas and needs. Consider this as a suggestion; we also invite you to join our telegram channel if you need any help or clarification. We’ll do our best to help you
As you have now learned, you shouldn’t put all your IOTX in one single staking bucket cause you will be linked to a very precise duration. However creating 1000 buckets is pointless and you will also spend a lot of gas to manage all those contracts. Therefore, you should create a balanced strategy
Split your holding into 4 amounts
- Long term holding: the amount of IOTX that you don’t plan to sell, whatever happens. Then decide the maximum amount of days your long term is. If it’s one year, then go for it: you will get max votes and more rewards
- Staked coins: the amount of IOTX that you plan to stake for a reasonable amount of time. The suggestion is at least 28–42 days to get about 20% bonus votes. Lock-in these coins, set autostake and ideally move them only if there is a reason (by removing autostake)
- Short-term stake: the amount of IOTX that you want to stake but that you’d like to have available quickly. Set 0-stake duration for these, so that you need only 3 days to get them back
- Non staked: the amount of IOTX that you’d like to move, trade or any other reason that might lead you to have them free and unlocked. Don’t stake them, BUT move them to your wallet. Don’t leave your coins on an exchange. It’s totally pointless and unsafe, and if you change your mind on what to do with your coins it’s better having them on your wallet
If you plan to have more than 1 delegate, you might want to have more than a bucket for any of the categories above. So if you want to have 2 delegates with a certain % of staked coins, split the total amount you were going to commit and act accordingly. However if you want to delegate for IoTexTeam you won’t need to do that ;)
Our delegator John has 100,000 IOTX and acts this way
20,000 coins are for the long term, so he creates a bucket with 238 days lockin, getting 30% bonus. So they count as 26000 votes, maximizing his returns for this amount of coins
50,000 coins are locked for 28 days and autostake. They weight as about 59,000 increasing his rewards, but still available in a reasonable amount of time
20,000 coins are on a short term notice. 0 staking. They still count as 20,000, no bonus, but quickly available
10,000 coins are unstaked. If he’d like to trade them or anything else, they are available. They count as 0 votes, however
So John by differentiating his buckets has 10,000 free coins and will still get rewards on 105,000 coins, increasing his ROI
We hope this long post helped you understanding what to do. Start staking ASAP! And if you need any help join us on Telegram!