TRON (TRX) Staking: What To Know And How To Get Started
Key Takeaways
- Exchange staking offers the easiest way to earn.
- Staking through a validator lets you build energy, a crucial requirement for smart contracts.
- Liquid staking can enhance returns dramatically.
The Tron network focuses on giving media creators and consumers more autonomy, and Tron’s TRX token is at the center of it all. TRX holders can support creators and developers directly or connect to a growing choice of DeFi apps, but can also participate in governance through staking. By committing your TRX to a validator, called a Super Representative, you can help secure the network and earn a yield as a reward.
In this article, we’ll discuss several ways to stake Tron, including the pros and cons of each.
What Is TRON (TRX) Staking?
Tron staking refers to the process of delegating TRX tokens to a Super Representative, Tron’s version of a validator node, a computer on the Tron network that assembles and validates blocks for the Tron blockchain. The process involves voting for one or more Super Representatives, which then earn rewards for validating blocks.
Nodes also earn voting rewards. The Super Representatives then pass a portion of the rewards on to TRX stakers who voted for their node.
When staking TRX, you can earn both validation rewards and voting rewards, but if the representative you vote for doesn’t earn enough votes to become a Super Representative, you’ll only earn voting rewards.
This assignment structure is called delegated proof-of-stake (DPoS). By staking, you’re delegating your TRX to your chosen Super Representative(s).
While you can earn a yield by staking, often about 4.5%, some other reasons to stake revolve around building energy and bandwidth, two key elements of the Tron blockchain. You can choose to build one of these two elements when staking, in addition to earning rewards.
- Energy: You’ll need energy to execute smart contracts on the Tron blockchain. Staking builds your energy reserves.
- Bandwidth: You use bandwidth to perform everyday transactions, such as moving TRX from one address to another.
For active users in the Tron ecosystem, yield is just one reason to stake. Staking also builds your reserves so you can do more on Tron’s network. For example, a funded wallet receives energy automatically, so you can send TRX to another wallet immediately. However, a new wallet starts with 0 energy, so you can’t execute smart contracts without building your energy reserves first.
As a technical matter, you only need to “freeze” your TRX to build energy or bandwidth. But freezing your tokens gives you voting power so you can earn more TRX by staking.
How Much Can I Earn By Staking TRON?
Staking rewards for TRX depend on where you stake and your staking method. For example, Gemini offers about 3% APY, whereas staking to a Super Representative often brings yields closer to 5% APY.
Check out more strategies for earning yield on crypto in our complete guide.
Staking TRX – What To Know
| Staking Information | Details |
|---|---|
| TRON Staking Minimum | 1 TRX |
| Staking Lockup Period | 72 Hours |
| Staking Options Available | Exchange, delegating, liquid staking, running a validator |
| Active Validators | 27, with 100 in reserve |
How Does TRON Allocate Staking Rewards?
Tron’s validation network is made up of 27 Super Representatives (SRs), which actively build blocks, and 100 Super Representative Partners, which may become active in block building if they earn enough votes. Super Representatives are the top 27 nodes by votes, and with a six-hour voting schedule, may change throughout the day.
Voting is key on Tron and allows you to earn voting rewards even if your chosen node does not earn an SR slot.
Tron awards 16 TRX for each validated block, which goes to the Super Representative that built the block. If you voted for that Super Representative, you’ll earn a proportional yield. For example, if the Super Representative has 10,000 votes and you committed 100 TRX, you would earn 1% of the block reward, less the brokerage ratio.
The brokerage ratio is the amount the Super Representative deducts from your earnings for server admin costs, etc. Expect brokerage ratios to range between 0% (no fees) to 20% (you keep 80% of your proportional share).
Tron also distributes 160 TRX in voting rewards for each block. This reward is distributed among the Super Representatives and Super Representative Partners according to their percentage of total votes. For example, if a Super Representative receives 5% of the total votes, that Super Representative will receive 8 TRX.
Rewards may be paid to an address you choose automatically, or you might have to claim rewards periodically. Each SR sets policy independently.
Tron currently generates a new block every three seconds, with daily block rewards reaching 460,800 TRX across all SRs. By contrast, daily voting rewards are 4,608,000 (split between all SRs and SR Partners), making voting a key part of staking on Tron.
How To Stake TRON
Much of the detail in the previous section refers to earnings when staking to a validator, called a Super Representative on Tron’s network. But delegated staking using an SR is just one way to earn a yield staking TRX.
There are actually four ways to stake Tron, each with a different level of difficulty and its own value proposition.
- Staking via a centralized exchange: A handful of exchanges, such as Gemini, allow staking TRX on the exchange itself. This option removes much of the complexity, but you’re trusting the exchange with your assets.
- Delegate directly to a validator: When delegating to a Super Representative, you can keep your TRX in your self-custody wallet. However, you’ll need to vote and may need to claim rewards manually.
- Liquid staking TRON: Liquid staking refers to exchanging your TRX for a staked-token equivalent, discussed later in this article. This method lets you use the value in your TRX, which you can’t do when your TRX is locked up with an exchange or delegated to a Super Representative.
- Run your own validator node: Technical users can also apply to run a validator node. The Tron network requires just 9,999 TRX (and a bit of technical know-how) to become a candidate.
Staking Via A Centralized Exchange [Easy]
By far, the easiest way to stake Tron is to use a centralized exchange. That’s because when staking through a centralized exchange, the exchange does all the heavy lifting. You won’t have to vote for Super Representatives, and you won’t need to choose between energy or bandwidth when staking. You won’t earn either one. Instead, the exchange handles these aspects in the background, often with no real transparency.
Staking through an exchange comes with some other caveats as well. For example, you lose the ability to lend your energy, an additional source of income for some TRX holders. Instead, the exchange keeps any income from staking, voting, and lending. In exchange, they pay stakers a yield for use of their TRX.
Most importantly, when staking through an exchange, you have to keep your TRX on the exchange, a practice that can introduce risk to your portfolio. The tradeoff is higher yields, in some cases, and a hands-off approach to staking that some TRX holders might prefer.
How To Pick A Centralized Exchange
Exchanges simplify the staking process and can provide higher earnings (sometimes), but it’s important to weigh some considerations before committing your TRX.
- Staking/unstaking period: Check to see how long you have to commit your TRX. Many platforms require a commitment of three to nine days that locks up your TRX.
- Yield: If all other things are equal, compare the yields. A 1% difference in yield can add up, particularly for larger staked balances and longer staking durations.
- Financial strength: When you stake on an exchange, the exchange holds your TRX. If the exchange encounters liquidity challenges, you may face delays in withdrawals or might not be able to withdraw at all.
- Exit plan: Some exchanges let you transfer your TRX from the exchange to a self-custody wallet. Others don’t support transfers on the Tron network. Instead, you’ll have to sell or exchange your Tron before you can withdraw. A sale or exchange can create another taxable event (in addition to the taxes due from staking income).
Pros And Cons Of Staking TRON Via A Centralized Exchange
Pros
- Easy to set up
- Potentially higher yields
- Stake immediately after buying or transferring TRX
Cons
- Exchange holds your TRX
- Can’t lend energy on the network
- Lower yields compared to liquid staking
Delegating Your TRON (TRX) To An Existing Network Validator [Intermediate]
With delegated proof-of-stake on the Tron network, you’re assigning your TRX to a validator of your choice by using your voting power. Each TRX equals one vote, and you can split your vote as many as five ways when voting.
If your chosen validator earns enough votes to become a Super Representative, you’ll earn rewards for any blocks built by that SR while you’re staked to that node and while it’s still an SR. Super Representatives can change throughout the day based on votes.
This staking option differs from exchange staking; you’ll be more involved in the process.
When delegating your TRX, you keep control of your tokens using a supported wallet, such as TronLink or Ledger Live, the wallet app for Ledger hardware wallets. Both wallets offer full support, so you can choose from a full list of SR candidates and also earn energy or bandwidth for freezing your TRX.
Note: Freezing your TRX allows you to build energy or bandwidth, but you’ll also need to vote to earn token rewards. It’s a two-step process.
Some other wallets support staking as well but may limit your options for delegating or not offer some features, such as earning energy and bandwidth. For example, Trust Wallet offers just four SRs for staking, with no option to choose energy or bandwidth by freezing your tokens.
In the next few sections, we’ll detail how to stake to a Super Representative using a full-featured Tron wallet.
How To Choose A Network Validator
Using a full-featured wallet, like TronLink or Ledger, you’ll have 127 validator nodes from which to choose. Some may be names you might recognize, but you might want to investigate further.
Tronscan offers a helpful way to compare, including all current votes and stats for current Super Representatives.
Here are some factors to consider:
- Reward distribution ratio: This number relates to the brokerage ratio discussed earlier. A higher reward distribution ratio can mean higher earnings due to a lower brokerage ratio (fee).
- APR: The APR is the current annual percentage rate, but is adjusted for the brokerage ratio. For example, an SR with a 20% brokerage ratio will show a lower APR in most cases.
- Productivity: The productivity measurement compares the number of blocks produced to the number of blocks missed. A lower productivity percentage may indicate server downtime or slow response times, potentially cutting into earnings.
- Votes: You might want to choose an SR that’s not in the top 27 to help keep Tron decentralized. However, if you choose one that has little chance of reaching the top 27, yields could suffer because you may not earn block rewards.
- Reward claiming: Some SRs require an extra step to claim your rewards periodically.
Pros And Cons Of Staking TRON Via A Network Validator
Pros
- Support decentralization by voting
- Earn energy or bandwidth to use on the Tron network
- Earn block rewards and voting rewards
Cons
- More steps compared to exchange staking
- Limited wallet support
- 72-hour commitment
How To Stake Your TRON Directly With A Network Validator
For this walkthrough, we’ll use the TronLink wallet, which is available for iOS and Android mobile devices. TronLink also offers a Chrome extension that you can connect to Tronscan to set up staking on your desktop.
Step 1: Download TronLink Wallet.
Visit TronLink to download the app version you need. Install the app and write down the 12-word recovery phrase you generate during setup. Make a note of the password you chose as well.
Step 2: Fund your wallet.
Select an exchange to purchase some TRX. Click on Receive in your TronLink wallet to reveal your wallet address. Send some TRX to your wallet address. You’ll need at least 1 TRX.
Step 3: Freeze the TRX you want to stake.
Choose Stake from the main screen to freeze your TRX and choose either Energy or Bandwidth. Remember, you’ll need energy for smart contracts and bandwidth for everyday actions like sending TRX.
Choose the percentage of your TRX tokens you want to stake as well.
In this example, we chose to freeze half the wallet balance to earn bandwidth.
Step 4: Confirm your receiving address and commit to staking.
You’ll earn TRON Power for freezing your TRX tokens. TRON Power equals voting power. For example, freezing 100 TRX gives you 100 votes you can use when choosing a Super Representative.
Verify the details and enter the password you chose at setup to confirm your transaction.
Now, you’re earning either energy or bandwidth, depending on which you chose. You’ll need to vote to earn block ad voting rewards, which we’ll cover next.
Step 5: Use your TRON Power to vote.
From the main screen, click on Vote in the middle right of the screen. This brings up a list of Super Representatives from which you can choose. You can choose up to five Super Representatives, assigning votes to each.
Step 6: Confirm your vote.
Now, you’re earning either energy or bandwidth for freezing your TRX. You’re also earning block rewards and voting rewards for voting.
Liquid Staking TRON [Advanced]
Staking TRX on Tron only requires a three-day lockup, but if you want to continue earning rewards, you have to keep your TRX staked. Liquid staking offers a way to earn from your TRX while still being able to use the value in your tokens for other purposes.
The market for liquid staking on Tron is still developing, but one new project shows promise. With STRX.finance, you can earn a higher yield compared to other staking methods due to how the platform uses TRX to enhance yields.
The basic process involves exchanging TRX for the SFI token, which represents the staked value of TRX. Over time, the value of SFI tokens increases, reflecting the earnings from staking. Your Tron wallet holds the SFI tokens you receive in the exchange.
To enhance earnings, STRX.finance also lends out energy, which can increase yields substantially, with estimates ranging from 15% to 40% in combined income from both voting and energy rental. The STRX protocol automates the process.
Similar to staking TRX to a validator, which requires a 72-hour staking commitment, SFI can be exchanged after 72 hours for TRX at the current exchange rate.
Watch for other liquid staking opportunities to emerge. Platforms like Lido, which currently offers liquid staking for five networks, may expand to offer liquid staking for additional networks as demand increases.
How To Pick A Staking Pool
Currently, there’s only one liquid staking option available for the Tron network. As the ecosystem grows, here are some considerations to weigh before making a commitment.
- Liquidity: Low trading-volume tokens may not offer a quick exit if needed.
- Unstaking lockup: Check to see how long you need to commit to staking. STRX requires a three-day waiting period but also offers emergency unstaking (for a small fee).
- History: Consider how much of your holdings you want to entrust to a newer platform.
- Yield: Weigh potential returns against other staking options.
- Income sources: Research how the staking pool derives its earnings. STRX earns staking rewards but also rents out energy to increase yield.
- Auditable code: Look for the smart contract code, typically on Github. There may be comments or bug reports that could be helpful in your decision.
Here’s the GitHub page for STRX.finance.
Pros And Cons Of Liquid Staking TRON
Pros
- Higher yields
- Tokens you can use while staked
- No voting required
Cons
- Can’t earn energy or bandwidth
- Three-day waiting period to unstake
- Limited liquid staking choices
How To Liquid Stake Your TRON
To illustrate liquid staking Tron, we’ll use TronLink wallet again. But this time, we’ll use the Chrome extension to connect to STRX.finance.
Note: STRX is a smart contract. You’ll need both energy and bandwidth to execute the contract. If needed, you can freeze tokens beforehand to earn more energy and bandwidth as described in the prior section about staking to a validator.
Step 1: Download the TronLink extension.
Visit TronLink to download the Chrome extension. Once installed, import a wallet with a 12-word recovery phrase or start a new wallet. If you don’t have any TRX yet, you can purchase TRX on an exchange that supports transfers on the Tron network.
Note: Be sure to write down your 12-word recovery phrase and the password you chose during setup.
Step 1: Connect to STRX.
Visit STRX to connect your wallet to the STRX protocol.
Click on Connect Wallet to connect your TronLink wallet.
You’ll get a request to connect in the browser extension. Click on Connect.
Now, you’re connected and can see your TRX balance.
Step 2: Choose an amount to stake.
On the right side of the screen, choose an amount to stake. This demo wallet has 10 TRX staked elsewhere so the max available for staking is less than the wallet balance. Click on Stake once you choose a staking amount.
You’ll get another request to connect to your TronLink wallet. Click Connect.
Step 3: Sign the smart contract.
Click Sign to execute the smart contract and exchange your TRX for SFI.
It worked! Now, you’re liquid staking on STRX. Your wallet now shows your SFI balance.
When you’re ready to unstake, visit STRX.finance again to exchange your SFI for TRX.
Run Your Own Validator Node [Advanced]
At the heart of Tron’s DPoS consensus mechanism, 27 Super Representatives assemble compliant blocks, earning block rewards in the process. A larger network, including 100 Super Representative Partners, join the SRs in earning voting rewards.
Running your own validator node isn’t for beginners, but Tron puts the keys within reach and with modest financial requirements.
Some Super Representatives set the brokerage rate as high as 20%, meaning the SR operator earns 20% of all block and voting rewards, passing 80% on to stakers who voted for their node. Others set the ratio at 0%, passing all rewards to stakers.
You’ll earn the difference in rewards, which may be up to 20%, but you’ll pay for hardware, management, and bandwidth costs. For many, however, running a node offers a way to support the Tron ecosystem, with profits as a secondary consideration.
What you need to run your own network validator node
First, you’ll need 9,999 TRX to apply as a candidate.
Hardware requirements include:
- 16-core CPU
- 32 GB RAM
- 1.5 TB SSD or larger
- 100 Mbps bandwidth
Tron provides a GitHub repository with a downloadable script to set up the server on macOS or Linux.
Pros And Cons Of Staking TRON Via Your Own Validator Node
Pros
- Contribute to Tron network security
- Earn from brokerage ratio on block rewards
- Earn from brokerage ratio on voting rewards
Cons
- May not earn anything
- Financial investment in hardware and bandwidth
- Well-established competition
How To Stake Your TRON On Your Own Network Validator Node
Step 1: Learn the server requirements.
Visit Tron Developers to learn more about hardware requirements and the steps to deploy server software.
Step 2: Apply to become a Super Representative
This section of Tron Developers provides a walk-through on how to apply to be an SR.
You’ll need to pay 9,999 TRX to apply. Some experience in staking is also helpful in understanding the various aspects of voting, rewards, and brokerage ratios.
To Sum It Up
Staking on the Tron network can be a rewarding way to support the network, but some staking methods require more steps compared to staking other crypto assets. You’ll find the highest yields with liquid staking whereas staking through an exchange offers the easiest way to start earning. Staking through a Super Representative, however, helps decentralize the network and lets you build energy and bandwidth you can use to participate in the Tron network.
Frequently Asked Questions
You can stake Tron through an exchange or by using a supported wallet to stake with a Super Representative (validator). STRX.finance now offers liquid staking as well.
When you stake Tron, you earn rewards (paid in TRX) for blocks built by your chosen validator. When staking through a validator, you can also earn TRX as voting rewards.
TrustWallet supports Tron staking. However, you’ll find a limited choice of validators. TrustWallet does not support freezing TRX to build energy.
Tron does not use slashing, a mechanism used by some blockchains that can put some of your staked tokens at risk. However, there may still be risks related to the price of TRX while your tokens are locked. Staking through an exchange also brings solvency or liquidity risks associated with the exchange itself.
Staking Tron can generate a healthy yield, but some staking methods require more interaction compared to staking on other chains.
In most cases, you only need 1 TRX to stake, although some platforms, such as Poloniex, require 100 TRX.
Currently, Poloniex and Crypto Innovation Fund offer the highest APR, although JD Investment often tops the list for the most votes.
For access to all of Tron’s staking features, consider staking with TronLink or Ledger’s Ledger Live wallet.
You can stake TRX on Atomic wallet. Currently, Atomic wallet limits users to two validator options.
