Staking Rewards Calculator: ETH, SOL, ADA, DOT Earnings

What Is Crypto Staking?

Staking is the process of locking cryptocurrency in a blockchain network to support its operations: validating transactions, securing the ledger, and maintaining consensus. In return, the network rewards stakers with additional tokens, similar to earning interest on a savings account. The concept emerged with Proof of Stake (PoS) blockchains as an energy-efficient alternative to Proof of Work mining.

When you stake tokens, you either run a validator node yourself or delegate your tokens to an existing validator. Validators are selected to propose and verify new blocks based on the amount of tokens they have staked. The more you stake, the higher the probability of being chosen and earning rewards. This mechanism aligns economic incentives: validators with significant stake are motivated to act honestly because malicious behavior can result in their staked tokens being destroyed (slashed).

How Staking Rewards Work

Staking rewards come from two primary sources: newly minted tokens (inflation) and transaction fees paid by network users. The proportion varies by network. Ethereum distributes both new issuance and priority fees to validators, while Cosmos relies more heavily on inflation-based rewards.

The Annual Percentage Yield (APY) represents your expected yearly return as a percentage of the amount staked. A 5% APY on 100 ETH means you would earn approximately 5 ETH over one year. However, actual rewards fluctuate based on network participation rates, validator performance, and protocol rules.

Two formulas govern staking returns:

Simple: Rewards = Principal x APY x (Days / 365)

Compound: Final Balance = Principal x (1 + APY / 365) ^ Days

Simple staking pays rewards that sit idle. Compound staking reinvests rewards back into the staking position, earning additional rewards on top of previous rewards. Over long periods, compounding significantly outperforms simple staking: $10,000 staked at 10% APY for 5 years yields $5,000 with simple interest versus $6,487 with daily compounding.

Staking APY by Network

Staking yields differ significantly across blockchains. Higher APY typically correlates with higher inflation, greater risk, or lower network maturity. The table below summarizes current staking parameters for major PoS networks:

These figures are approximate and change over time as network conditions evolve. Always check current rates on the official network documentation or staking dashboards before committing funds.

Factors That Affect Staking Returns

Several variables determine your actual staking yield beyond the advertised APY:

• Network participation rate: when a larger percentage of tokens are staked, rewards are distributed among more participants, reducing individual yields. Conversely, low participation rates increase per-staker rewards.
• Validator commission: validators charge a commission (typically 5-15%) on the rewards they distribute to delegators. A validator with a 10% commission means you receive 90% of the base reward rate.
• Uptime and performance: validators that go offline or miss block proposals earn fewer rewards. Some networks penalize poor-performing validators, reducing delegator earnings.
• Compounding frequency: rewards that are automatically restaked compound your returns. Networks differ in how frequently rewards accrue: some distribute every epoch (hours), others every era (days).
• Token price volatility: staking rewards are denominated in the native token. A 10% APY means nothing if the token price drops 50%. Your dollar-denominated return depends on both the staking yield and the token's price performance.
• Inflation rate: high APY funded primarily by inflation can be misleading. If a network inflates its supply by 15% annually and you earn 18% APY, your real yield above inflation is only 3%.

Staking vs Other Yield Strategies

Staking is one of several ways to earn yield on crypto holdings. Each strategy carries different risk profiles:

Staking is generally considered lower risk than DeFi strategies because it relies on protocol-level mechanics rather than smart contract logic. However, the lock-up periods associated with many PoS networks mean you cannot quickly exit your position during market downturns.

Risks of Staking

Staking is not risk-free. Understanding the potential downsides is essential before committing funds:

• Slashing: validators that double-sign blocks or exhibit malicious behavior can have a portion of their staked tokens destroyed. As a delegator, you share in slashing penalties. On Ethereum, minor slashing events can cost 1-5% of staked ETH, while correlated failures can result in larger penalties.
• Lock-up periods: most networks impose unbonding periods during which your tokens cannot be moved or sold. Polkadot requires 28 days, Cosmos requires 21 days, and Solana requires 2-3 days. During volatile markets, being unable to sell can result in significant losses.
• Validator risk: choosing a poorly run validator can result in missed rewards or slashing. Research validator uptime, commission rates, and reputation before delegating.
• Inflation dilution: if you hold tokens without staking while the network inflates, your share of the total supply decreases. Staking is partly a defense against dilution rather than pure profit.
• Smart contract risk (liquid staking): liquid staking protocols like Lido (stETH) and Marinade (mSOL) introduce smart contract risk. A bug in the protocol could result in loss of funds, even though the underlying staking mechanism is secure.
• Regulatory risk: some jurisdictions may classify staking rewards as taxable income. The SEC has also scrutinized staking-as-a-service offerings, which could affect the availability of certain staking products.

Liquid Staking

Liquid staking solves the liquidity problem of traditional staking. Instead of locking your tokens directly, you deposit them into a liquid staking protocol and receive a receipt token in return: stETH for Ethereum (via Lido), mSOL for Solana (via Marinade), or rETH for Ethereum (via Rocket Pool).

These receipt tokens represent your staked position plus accrued rewards. They can be traded, used as collateral in DeFi protocols, or held in your wallet while your underlying tokens continue earning staking rewards. The trade-off is an additional layer of smart contract risk and a small protocol fee (typically 5-10% of rewards).

Liquid staking has become enormously popular. On Ethereum, over 30% of all staked ETH goes through liquid staking protocols. For users who want staking yield without sacrificing the ability to use their assets in DeFi, liquid staking offers a compelling middle ground.

Frequently Asked Questions

How much can I earn staking crypto?

Earnings depend on the network, the amount staked, and the APY. For example, staking 10 ETH at 4% APY earns approximately 0.4 ETH per year (roughly $1,400 at $3,500 per ETH). Staking 1,000 SOL at 7% APY earns about 70 SOL annually. Use the calculator above to model specific scenarios with your actual amounts.

Is staking crypto safe?

Staking on major PoS networks is generally safe but not risk-free. The primary risks are slashing (validator penalties), lock-up periods that prevent selling during downturns, and the possibility that the token's price drops more than the staking yield. Choose reputable validators, diversify across multiple validators when possible, and never stake more than you can afford to have locked up.

What is the best crypto to stake?

There is no single "best" crypto to stake. It depends on your risk tolerance, time horizon, and conviction in the underlying network. Ethereum offers lower yields but is the most established PoS network. Cosmos and Polkadot offer higher APY but come with longer lock-up periods and higher volatility. Evaluate each network's fundamentals, not just the APY number.

How does compound staking work?

Compound staking means reinvesting your staking rewards back into your staked position. Instead of letting rewards sit idle, you add them to your principal so they earn additional rewards. The formula is: Final Balance = Principal x (1 + APY/365)^Days. Over long periods, compounding produces significantly higher returns than simple staking. Some protocols auto-compound, while others require manual restaking.

What is slashing in crypto staking?

Slashing is a penalty mechanism that destroys a portion of a validator's staked tokens when they violate network rules. Common slashable offenses include double-signing blocks (proposing two conflicting blocks) and extended downtime. Slashing exists to discourage malicious behavior. As a delegator, your tokens are also subject to slashing if your chosen validator misbehaves, which is why validator selection matters.

Can I unstake anytime?

It depends on the network. Cardano allows instant unstaking with no penalty. Solana requires a 2-3 day cooldown period. Polkadot has a 28-day unbonding period, and Cosmos requires 21 days. During these unbonding periods, your tokens earn no rewards and cannot be transferred. Liquid staking protocols offer a workaround: you can sell your receipt tokens (like stETH) on the open market at any time, though prices may differ slightly from the underlying asset.

What is liquid staking?

Liquid staking lets you stake tokens while maintaining liquidity through receipt tokens. You deposit ETH into a protocol like Lido and receive stETH, which represents your staked ETH plus accrued rewards. You can trade stETH, use it as DeFi collateral, or hold it while your underlying ETH continues earning staking rewards. The trade-off is additional smart contract risk and a protocol fee on rewards.

Is staking better than holding?

In most cases, staking is better than simply holding if you plan to keep the tokens long-term. Staking earns yield on an asset you would otherwise hold idle. The main reasons not to stake are if you need immediate liquidity (and the network has a long unbonding period), if you are concerned about slashing risk, or if you believe the token price will drop significantly during the lock-up period and want the flexibility to sell quickly.

This calculator is for informational purposes only and does not constitute financial advice. Staking returns are estimates based on the APY you enter. Actual results may vary due to network conditions, validator performance, slashing events, and token price fluctuations. Always do your own research before staking cryptocurrency.