How to Stake Casper in 2023 and Choose A Validator
A step-by-step guide on how to stake Casper using Simple Wallet, Casper Signer and choose the right validator
In a nutshell, this Guide on How to Stake Casper is about:
The Casper Network, built by CasperLabs, is among the first protocols to implement a sharding model architecture. It brings scalability to the chain without security and efficiency compromises to serve large Enterprises.
CSPR token holders can delegate them to validators helping to maintain the stability of the chain. The process of delegating tokens is called staking, which provides an investment return to token holders.
Casper could be a promising long-term investment, considering that you can rely on the digital asset price increase and stake them.
How to Stake Casper — The Two Options
There are two ways to stake Casper coins: centralized and decentralized ones. They both have pros and cons listed below.
1. The Centralized (custodial) Staking
It's a way to stake coins via any Central Exchange. In return, you receive rewards according to commission rates set by the Exchange you choose.
It's like depositing money in a bank and having a sub-account in a crypto coin that generates a yield income.
- Simplicity — you deposit fiat to your balance, buy coins, and receive rewards automatically;
- No wallet necessary — you don't need to install one more wallet and remember the seed phrase;
- Better reporting — in general, Central Exchanges could provide APY and tax reporting if required;
- Lower APY — Central Exchanges serve as mediators charging a cut for the simplicity, and as a result, the APY is lower (unless there's a promo);
- Lack of coins control — you rely on a 3rd party to store coins and have no control over them, so if something happens, you'd be in trouble;
- Geo/KYC restrictions — it's up to a Central Exchange to offer you their services or not based on existing policies;
Central Exchanges with Casper staking:
Custodial staking is a good choice if you don’t want to deal with various wallets keeping some of your funds in an Exchange. However, if your stake amount is sufficient, consider non-custodial staking.
2. Decentralized (non-custodial) Staking
It's the way of staking tokens via a wallet to a smart-contract of the network. It has no mediator and provides token control to its holders.
- Higher APY — with no mediator, non-custodial staking brings higher APY compared to custodial staking (unless an Exchange runs a promo);
- Funds control —thanks to a smart contract, a token holder always keeps control of their tokens (even while they're being staked);
- No Geo/KYC restrictions — anyone with a proper wallet can stake coins with non-custodial staking;
- Complexity — in some networks, non-custodial staking could be cumbersome;
- A wallet is necessary — there is a need to use a wallet that supports non-custodial staking for the chosen network;
- Reporting issues — understanding the actual yield and getting tax reports could be a challenge in most networks;
Wallets with Casper non-custodial staking:
Non-custodial staking is for token holders concerned with security and those with substantial amounts of tokens. It’s not an easy process for the Casper network, so we’ll explain it in detail below.
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How to stake Casper via Non-custodial Staking
A wallet with CSPR coins is necessary for non-custodial staking. See step-by-step instructions for the Casper wallets below.
How to stake Casper with Simple Wallet
Simple Wallet is a new app built to make non-custodial staking as simple as clicking one button. To stay updated, subscribe to their Telegram group.
1. Install Simple Wallet's Chrome extension via the link.
2. Create a new Casper Network address or use your existing private key.
3. For a new wallet address, you'll need to deposit Casper coins, i.e., withdraw from an exchange.
4. Click on the Stake tab after you receive coins at your address.
5. Click on the Select validator field — enter a validator's address or choose the one from the list. To find out more about choosing a validator, proceed to the last part of this guide.
6. Enter the amount to be staked and click on the Stake button. Done! You will get a link to your transaction on the Casper blockchain.
Tip: There is a waiting period of 2 full eras (each one is two hours) to start receciving rewards. You will see them in 4–6 hours in your Staked Balance.
How to unstake CSPR with Simple Wallet
You can unstake (undelegate) your tokens at some point. To do so with Simple Wallet, follow this instruction.
1. Open the Simple Wallet's Chrome extension.
2. Click on the 'Unstake' tab to see all your staked coins.
3. Click on any of your previously made stakes. Simple Wallet will automatically fill in the validator's address and the sum. You can enter a lower amount and unstake a part of your staked balance if needed.
4. Click the Unstake button. You will get a link to your transaction on the Casper blockchain.
Tip: It takes 7 full eras to get your coins from Staked to Liquid Balance. During this period (14–16 hours) you’re not earning rewards.
How to stake Casper with Casper Signer
Casper Signer is the official non-custodial wallet that allows you to manage private keys and sign transactions on Casper Network.
2. Run the extension and create a Vault by entering a secure password. After that, you will see two options: Import Account or Create Account.
3. Choose Create Account if you haven't created an account in the Casper Network. Fill up its name, choose (any) algorithm and click Create.
Tip: Make sure to download a file with your private key. It’s essential to store it in a secure place. If you lose the private key, tokens will be lost forever.
4. If you previously created a Casper account, proceed to Import Account. You'll be asked to upload your private key and name that account.
Your Casper account with Casper Signer should be visible in the app. Use Key Management from the upper right menu to manage your keys.
5. To start staking, you need to create an account at CSPR.live. Click Sign In in the upper right corner of the website.
Then select the Casper Signer as the sign-in option and unlock your account previously created.
When done, your unique Casper address is shown at the top right of the CSPR.live website. Click here whenever you need to manage your account.
Tip: You will also see the list of websites connected to the app in the Casper Signer and can manage it in the Connected Sites menu.
6. It's time to add funds to your Casper account. Click on your address at the top and select Copy Public Key.
To receive tokens, share this address with the sender or the exchange where you buy CSPR. To check your account balance, click View Account.
When your account has been funded, you can proceed to CSPR staking.
7. To stake Casper tokens, select Wallet at CSPR.live and click Delegate Stake from the menu.
Select a validator from a list by either browsing it or doing a search (you can search by name or by hash) and enter your stake amount. We recommend leaving 5–10 CSPR on your balance to cover unstaking transaction fees.
Then click Next, review, and confirm your order by clicking Confirm and delegate stake. In the next step, you'll need to sign your transaction with Casper Signer using the Vault previously created.
Your delegation is made. Congrats.
How to unstake CSPR with Casper Signer
The unstaking process is very similar to staking. To withdraw CSPR tokens, click on the Wallet and select Undelegate Stake from the menu.
Click on the Validator field to see all your active stakes. Choose the one you want to unstake, and fill in the sum (it could be lower than the initial stake).
Click Next, then Confirm and undelegate stake, and in the next step, sign the transaction. Done.
Tip: When checking your account balance, you will notice the Undelegating balance has been updated with the amount you’ve previously unstaked.
It will take up to 14–16 hours to see tokens back in your Liquid balance.
How to Choose a Validator and Calculate Rewards
A validator is a node operator that runs a node and holds some coins on its nodes. They usually receive a commission for this job based on the amount of coins delegated to their nodes.
When staking, you don't send coins to a validator but rather delegate the voting power for the corresponding amount. You receive a reward, and a validator gets its part (a validator fee/commission).
Here is an example.
You stake 1000 CSPR at 9% APY to the validator with a 10% fee. In a year, you'd earn 90 CSPR, but 10% of that would go to a validator. So the split will be the following:
- 81 CSPR to you;
- 9 CSPR to the validator;
Does it mean one should seek the validator with the lowest fee? Not exactly, as some events may affect the effective APY.
The validator's node receives awards when it's online. If it goes offline for some time, it doesn't participate in the voting and won't receive rewards during the eras it was offline.
Another common issue is when validators increase their fees without further notification of their delegators. It could be a surprise if you leave your stake for a while.
It means one should seek a validator with the intersection of the lowest fees, the highest uptime, and with the best reputation. In our opinion, these are one of the best validators in the Casper Network:
- Forest Staking (5% fee);
- Stakepire (5% fee);
- C-Stake (3% fee);
- Safe and Steady Staking (0% fee);
- Speedy Staking (3% fee);
Tip: if you want to explore other validators in the Casper ecosystem, here is the link.
Casper is called the “future-proof blockchain” based on the Casper CBC specification with its Highway Casper Protocol, the consensus mechanism that upholds the Casper network. It was built by Vlad Zamfir, an Ethereum developer who joined CasperLabs as their lead architect.
PoS consensus mechanism is a blockchain technology used to verify and validate cryptocurrency transactions. That’s different from mining, where miners validate new blocks. There are more PoS networks, including a shift of the Ethereum network, a long-planned move by Vitalik Buterin.