Staking

Crypto economic security is not a meme. It implements the age old technique that has worked in building civilizations, raising well behaved kids and pets etc. which is to incentivize a certain behaviour and punish potentially malicious behaviour. When the price to pay is extremely high when compared to the benefit of not following the protocol, the rational actors tend to follow the protocol and get incentivized for doing so.

Polkadot is a decentralized network. The DOT token is distributed across numerous organizations and individuals. Most of them place their DOT at stake to secure the network through a sophisticated protocol called Nominated Proof of Staking (NPoS). They secure the network by selecting validators (up to 16 in count) who they think are genuine and honest network actors. Selecting highly performant validators will fetch them good staking rewards. Selecting validators with mediocre performance will fetch them less staking rewards. Selecting malicious validators will result in slashing, which wipes some or in extreme cases all of the DOT from the nominator's account.

Direct vs Pooled Staking

Polkadot currently supports 22500 individual accounts directly to participate in staking. As NPoS algorithm tends to prioritize accounts with high balance, your account may or may not make it into the active nominator set. If you have lower DOT balance than the current minimum active nomination, it is recommended for you to join a nomination pool. The pool account is likely to be selected into the active nominator set and you will earn rewards proportional to your pool stake.

Staking Apps

If you like to stake DOT, you can do so through

• Polkadot Staking Dashboard
• Wallets with Staking Support