Stacking is the process of locking STX tokens to participate in the Stacks network's security, generating Bitcoin rewards in return. Blockdaemon now offers enterprise-grade Stacking for institutional clients.
The minimum amount of STX required for Stacking is dynamic.
A useful resource for estimating the minimum STX needed is lockstacks.com.
Tokens are locked for approximately 2 weeks, with slight variations due to the Bitcoin network's confirmation time variances.
Stackers must confirm their intention to lock STX before the prepare phase of the next reward cycle, which is the last 100 Bitcoin blocks of the ongoing reward phase.
Unlike staking mechanisms on other blockchains, Stacking in the Stacks network does not have a slashing mechanism. This means Stackers do not risk losing their stacked STX.
Rewards for Stacking are paid out in BTC, not STX.
The original STX tokens are unlocked at the end of the cycle without any deduction for participation.
Generating additional STX is possible through means separate from the Stacking process.
Blockdaemon Validator: STX holders are able to delegate to a Blockdaemon validator to participate in the network and receive rewards.
As part of the Stacks Nakamoto upgrade, Blockdaemon will serve as a Signer, playing a crucial role in the ecosystem. Stacks Signers are responsible for signing and validating blocks produced by Stacks miners, as well as signing and validating sBTC mint and redeem transactions once sBTC launches later this year. Additionally, Signers secure BTC rewards for their work.
Stackers need to become Signers themselves to receive PoX rewards for staking STX tokens or delegate this responsibility to a trusted Signer, like Blockdaemon.
Get in touch with Blockdaemon today to learn more about Stacks and how to get started stacking STX.