Onchain is a modern way to earn on cryptocurrencies through staking.

What is on-chain staking and why is it becoming increasingly popular? On-chain is a system that allows users to directly lock their crypto assets within the blockchain and earn rewards for maintaining network security. Unlike traditional staking, which requires specialized technical skills and equipment, on-chain staking is a simplified solution accessible to everyone.

Main Advantages of Participating in On-Chain Staking

When you direct assets into on-chain staking, you perform several functions at once. First, you help strengthen the security of the Proof-of-Stake (PoS) network, which is crucial for the stability and reliability of the protocol. Second, you receive regular rewards in the form of new tokens or transaction fees.

A third, equally important benefit is that staking participation helps the network achieve true decentralization. The more independent participants support the protocol, the harder it becomes for any attempt to manipulate the system. This is critically important for the long-term stability of any blockchain.

An additional advantage: you can withdraw funds almost at any time without losing access to your assets. Although some protocols impose lock-up periods, these typically range from a few hours to several days.

How Rewards Are Formed and Where They Come From

Rewards for participating in on-chain staking come from two main sources. The first is new tokens created by the protocol according to its inflation schedule. The second source is transaction fees paid by users when performing transactions.

The amount each staker receives depends on the total staked capital and the distribution rules set in the protocol. Different blockchains use various mechanisms, but the principle remains similar: the more tokens involved in securing the network, the lower the reward per individual participant (per token), but the higher the overall network security.

What Is Variable APR and How Is It Determined

APR (Annual Percentage Rate) is a key indicator of yield. On-chain staking is not a guaranteed percentage but a variable figure that depends on multiple factors.

Factors influencing APR include:

• Total amount of staked assets in the network — the more funds involved, the lower the percentage yield per token
• Protocol inflation rate — protocols with higher inflation generally offer more attractive APRs
• Transaction volume in the network — more active networks generate higher fee rewards
• Additional bonus programs — some platforms add their own bonuses to the base APR

Special bonus programs can increase current yields through separate funds. These bonuses are usually credited daily and require you to keep assets staked for the full calculation period (e.g., 24 hours). The bonus amount can vary daily depending on the available reward pool.

Risks Associated with On-Chain Staking

On-chain staking is not risk-free. There are several types of risks that participants should consider.

Market risks are the most obvious. Cryptocurrency prices are highly volatile, and the value of assets in your stake can drop significantly. If you staked 1 ETH at $3000, and the price falls to $2000, your loss will be $1000 regardless of the rewards earned.

Lock-up periods are related to the fact that some protocols lock assets for a certain period. If you need funds urgently, withdrawal may be delayed. Additionally, technical failures or network attacks can, in rare cases, reduce rewards or temporarily restrict access.

Systemic technical risks are less likely but cannot be ruled out. Vulnerabilities in the protocol code, although identified before launch, could theoretically be exploited against participants.

Verification Requirements

To start working with modern staking platforms, you need to undergo identity verification (KYC). This is a standard regulatory process requiring you to provide identification data. Usually, verification at the standard level takes from a few minutes to several hours.

Fee Structure and Calculation

Platforms offering staking services charge a fee on your earned rewards. The fee is expressed as a percentage of your income. For example, if you earn 10 USDT and the fee is 1%, you will receive 9.9 USDT.

The percentage fee varies depending on the protocol used. When choosing a platform, it’s important to review the current fee structure for each specific asset, as fees can differ even within the same platform.

Supported Tokens and Protocols

On-chain staking applies to various crypto assets. Popular PoS-based tokens include Bitcoin, Ethereum, Solana, and many others — supported by platforms providing staking services. Each protocol has its own rules regarding minimum deposit amounts and withdrawal conditions.

When selecting which protocol to stake your assets in, it’s important to understand that conditions can vary significantly. Some offer quick unlocks, while others require longer lock-up periods but provide higher yields. The current list of supported assets can be found in the platform’s dedicated sections.

Flexibility in Management and Withdrawals

Participants can withdraw staked assets almost at any time. On-chain systems do not lock your funds permanently, although some protocols impose restrictions.

The unlock period can range from several hours to several days depending on the specific blockchain’s rules. Additionally, there is the possibility of restaking — re-delegating assets into staking again to earn additional income.

On-chain staking is a constantly evolving area in the crypto economy, offering network participants fairer earning mechanisms and contributing to the decentralization of blockchains.