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The first step to staking on Tezos using a temple wallet is to download the temple wallet by using the Temple Wallet browser extension. The next step will be to add some Tezos to your wallet as this will be needed to begin staking. Moving to step 3, you should navigate to the Delegation Tab and identify your baker. To proceed, check that your coins are staked and you have completed the process of staking on Tezos!
The Tezos blockchain has created a unique form of architecture, designed to enable self-amendments to be carried out directly by the network itself. This step ensures that network participants are prevented from going through hard-forks, while also providing novel and verifiable smart contracts. Additionally, the new architecture has also designed a novel block validation paradigm as well as introducing the Michelson programming language.
In 2017, the implementation of these new technologies ensured made it possible to run a successful ICO, which in turn raised a staggering sum of over $230 million for the founders of the project, Kathleen and Arthur Breitman. Meanwhile, Tezos gained excellent support from the community through initiatives and country-wide meetups.
These flexibility features have been pivotal in establishing Tezos as one of Blockchain’s most popular online platforms. Today, we’ll be looking at why these services are have proven so pivotal in promoting yield farming and staking operations and cover some of the technological aspects that make Tezos Network unique in its success.
First of all, we need to consider what the Tezos Network is. The network is developed on the Liquid-Proof-of-Stake (LPOS) consensus algorithm and used a minimal selection of network validators to develop the necessary blocks. Generally speaking, blockchain networks aim to grow their total transaction throughput; nevertheless, this may not actually be the most crucial aspect of network characteristics that should be promoted and enhanced on the blockchain network.
Indeed, the Tezos blockchain is actually very modest in terms of its throughput; it is thrice as fast as the Ethereum network, which in and of itself isn’t an overly impressive claim. However, Tezos is able to offer perks in other areas, such as through its latest self-amendment updates. Meanwhile, Tezos has also created its own brand new programming language that has been designed exclusively for smart contracts. This new language is referred to as Michelson. It enables formal verification and transparent code reviewing, while also making it simpler for robust and versatile coding to be developed to mitigate risks.
The Tezos Foundation supports the new ecosystem through financial incentives while also delivering a reliable testing and developmental infrastructure to further grow and develop opportunities relating to the system.
As we already explained, the Tezos Network’s unique ecosystem based on the LPoS consensus mechanism. This mechanism requires users to vote/stake for a validator, which in turn provides benefits and rewards while enhancing network security. Most commony, bakers are chosen based on their contributions to the network. However, it is also occasionally the case that users spread their votes, which helps to offset the risks of network centralization.
Inflation for the Tezos network presently falls at about 5%, and tezzies (XTZ) coins are provided as a reward to voters. Notably, staked XTZ are also allowed, which is a unique feature.
It takes around 400 bakers to validate a new block; of these, one individual creates the block, and a further thirty two are responsible for its validification.
Network hard folks are a common scenario for blockchain users; however, the Tezos network is unique in that it overcomes this issue. Indeed, hard folks can represent a serious division within the community, but Tezos ecosystem is able to overcome this complication thanks to its innovative voting systems. The flexible ledger development system follows a three-step procedure as follows:
Firstly, the developer proposes an amendment. The amendment should offer benefits to the network and must be attached with an invoice. Following this, the amendment is reviewed, and thirdly, if it is approved, it will be sent to a developer to implement. The network participants are then able to assess the code and vote for or against it, following which further testing can be carried out if it is approved by the Testnet. In this manner, the network is heavily reliant upon its bakers to ensure updates are made efficiently.
The Tezos ecosystem supports multiple types of wallets, although, for today, we will be primarily focusing on wallets that are able to connect to DeFi services, which include the following options:
Browser Extension Wallets:
Browser extension wallets, such as Temple Wallet and Spire Wallet, are lightweight browser extensions. They are capable of holding cryptocurrencies, and bakers can be delegated XTZ easily. It is notable that some browser extension wallets may require pairing with desktop, mobile or hardware wallets to allow the creation of private keys.
Desktop Wallets:
A second variety is desktop wallets, such as the Galleon wallet. Generally speaking, these are amongst the most advanced Tezos wallets, and they are available across all systems, including MacOS, Linux, and Windows. Desktop wallets can be used for hardware signing and interacting with DeFi services.
Web Wallet:
As a third option, web wallets (such as Kukai) can open Tezos wallets online, while also providing support for hardware signing via Ledger. Kukai is especially notable as it was actually developed by a former Tezos developer.
Transferring funds to a Tezos wallet is a fortunately simple method, and is sometimes necessary as other wallets (for example, the Temple Wallet) may not have a built-in feature that enables it to support XTZ tokens. In these instances, Tezos users will need to source XTZ from external exchanges before sending them to their chosen wallet.
To do so, you’ll first need to purchase XTZ tokens on the exchange, and then select “receive” to send your purchased tokens to a wallet of your choice. Then, simply use the address as standard to send your XTZ to the chosen crypto wallet.
Bender Labs recently released The Wrap Protocol to enable two blockchains to be interconnected. This means that Ethereum-based ERC-20 and ERC-721 tokens can be fully compatible with Tezos wrapping Ethereum-based tokens with Tezos’s FA2 token standard. This eliminates the risk of technical complications or variations in terms of prices. The following website can be used to wrap tokens safely and effectively: https://app.tzwrap.com/wrap.
As we already mentioned, Tezos is unique in that it allows staking and delegating, and the process is, fortunately, a simple one that does not even need much prior blockchain knowledge. If this is something you are trying for the first time, we recommend using the Temple Wallet for yield farming and staking with Tezos.
Start by downloading the Temple Wallet browser extension. We highly recommend you save the seed somewhere safe but accessible; this ensures that you’ll be able to regain access to the wallet, even if you lose access to its for whatever reason. At this point, we should also point out there is no minimum staking value. This means that even a single XTZ token can be staked to a baker, if a user should desire.
Now that the wallet has been created, you need to have some XTZ before you can start staking. All you have to do is click the Receive button, which will show you the address to your wallet.
So to add the funds, click Copy to clipboard and enter the address in the exchange you’re looking to send the funds from. As soon as the funds have arrived, you’re ready to start staking.
Once you have opened the Tezos wallet, navigate to the Delegation tab and, when prompted, select Delegate Now, and identify the appropriate baker.
We highly recommend you choose a reliable baker, as failing this, you could end up missing blocks and receiving a lesser reward as a result. Here at Blocksteria we recommend choosing Everstake.
You should also note that every baker will ask a different commission for their services; as such, being aware of the price for your services is also crucial before proceeding.
Whenever you feel ready, click Delegate, and then confirm the transaction.
If everything worked out then you should now see the following picture, which means that your coins are staked.
If you want you can go back to your wallet to see your active delegation and re-register your coins.
It’s always worth knowing about the different opportunities and solutions available to you, and there are other options for staking and delegating with Tezos aside from the aforementioned method. Indeed, you can also use other tools and methods, such as Stakewith.us, or Staked.us, to complete your staking efforts. Below, we’ve provided some simple instructions on how to use the latter.
We recommend that you use the following link if your XTZ tokens are stored on a ledger: https://staked.us/v/staketezos
Alternatively, first head to https://cryptonomic.tech/galleon.html and download the Galleon wallet. Once you have completed the Galleon wallet download, you can then create an account by following the provided instructions, after which point launch the wallet and navigate to the Delegate tab. Here, you should be prompted to enter an address; you should use the following Staked’s baker address: tz1RCFbB9GpALpsZtu6J58sb74dm8qe6XBzv. Finally, to submit the transaction, select “change delegate” to submit.
Thankfully, yield farming with Tezos is a generally simple procedure, although you will need XTZ tokens and a Liquidity Provider to enter a specific yield farm. For the purposes of this guide, we will predominantly focus on the https://www.plentydefi.com/ service, as well as the provided XTZ/PLENTY pair, however, any other pair can also be used as Plenty has plenty of options.
To begin with, we need to purchase Liquidity Provider tokens. Your chosen tokens must operate on the FA1.2 standard; we should note that this is very close to the ERC20., although you should be careful not to get confused with other networks.
Next, navigate to the Decentralized Exchange at https://quipuswap.com, where the app will prompt you to connect your Temple Wallet. This exchange was developed by the same team (Madfish Solutions) as created the Temple Wallet, making it the natural choice for those looking to begin yield farming.
First you buy some Plenty with your Tezos XTZ tokens.
Then you go to the Quipuswap Invest tab.
Once you have found the “Input” field, you should select XTZ as the input and PLENTY as the Output, and continue the process as prompted until the transaction has been completed. Then, head to https://www.plentydefi.com/ to connect your Temple Wallet. Doing so will give you the opportunity to select a “Farms” option; once you have selected this, look for the XTZ/PLENTY pairing and select “Stake” and confirm it with your XTZ wallet to commence the process.
But how does this actually work? Well, suppose that you initially had 20 XTZ, and you exchanged 10 of these for 25 PLENTY. This would give you a total of 10 leftover XTZ in your wallet, along with an additional 25 PLENTY. Then, to use the highest possible asset availability, you should input the 95% of your XTZ amount (Leave some for transaction costs) this will trigger the system to automatically determine the appropriate amount of PLENTY. Then, all that’s left to do is confirm the operation; the system should largely do this for you.
Now you will start gaining rewards for farming the PLENTY Token.
If you’re looking for a network to use with yield farming, then the Tezos network’s secure smart contracts are the ideal option for easy verification, particularly in comparison to contracts on the Ethereum network. Since the Tezos network uses its novel Michelson programming language, formal verification of smart contracts is much simpler, and this allows developers to rapidly determine any existing vulnerabilities within the code. This differs significantly in comparison to the Ethereum network, whereby a large number of digital assets can be rapidly lost due to Rug Pulls.
The Tezos platform is potentially a more stable solution, then. The superior robustness of the instruments ensure that the Tezos Platform could be a superior option over the Ethereum network, despite the reduced number of Defi services. Generally speaking, the Tezos ecosystem is better for risk diversification and yield farming, and it offers a generally valuable APY overall. To this end, if you have been looking to earn a passive income, Tezos could offer a valuable opportunity; so, why not give it a try?
