How to stake and earn Tron (TRX)

Tron's white paper states the project's goal is "the establishment of a truly decentralised Internet and its infrastructure". The blockchain targets the storage and distribution of digital content and removes the need for an intermediary, like Netflix or Amazon. It achieves this by delivering "high throughput, high scalability, and high availability for all Decentralised Applications (DApps)".

What does this mean? In practice, its goal is to harness smart contracts and Ethereum-style "virtual machines" to pay creators directly for their content. This could include videos on a streaming platform or in-game accessories. By removing the middlemen, the creators are paid directly in the network's native coin Tronix (TRX).

Earn yield on Tron

The easiest way to earn TRX is through an exchange or specialised lending platform. These services lend your TRX to borrowers and pay you with yield (APY) for doing so, similar to a savings account. Although keep in mind that cryptocurrency lending services do not provide the same guarantees as traditional banks, and are not subject to the same rules and regulations.

Use the table below to compare rates on TRX then forecast your earnings using the calculator provided.

Must read: What is staking?

Staking is a process employed by blockchains that run on a proof-of-stake consensus mechanism. In comparison to proof-of-work which relies upon "miners" using computational power to update the blockchain, proof-of-stake relies upon validators. Utilising much less computing power, these validators update and ensure the security of the associated blockchain.

To become a validator or "node", a user must stake a predetermined amount of the native cryptocurrency into a network wallet. The deposit is locked in the network and ensures the accuracy of validations. The amount of staking rewards is usually proportional to the amount of cryptocurrency staked.

Proof-of-stake is simultaneously a more efficient and more democratic alternative to traditional mining. It promises to unlock the full potential of blockchain technology while using a fraction of the energy.

What is Tron staking?

One thing that sets Tron apart is its Super Representative system. This is a term utilised by Tron and refers to its delegated proof-of-stake consensus mechanism, which is a deviation from the standard proof-of-stake mechanism.

Unlike many proof-of-stake systems that have thousands of nodes, there are only 27 candidates or Super Representative nodes on the Tron network. These candidate nodes are selected by all other TRX holders that stake in the Tron network.

Within the Tron network, a user needs to stake a minimum of 1 TRX token to become a node. A token-holding node is then entitled to either put themselves forward as a Super Representative, with the addition of 9,999 TRX tokens, or simply vote for the Super Representative they prefer. 1 TRX token equals 1 vote. The more TRX staked, the more voting power a user will hold. Voting takes place every 6 hours.

Super Representatives validate the data added to the Tron blockchain and are rewarded with 32 TRX tokens for each block created. A new block is added to the blockchain on average every 3 seconds. The Super Representatives can then distribute their rewards to those who voted for them. They retain a high degree of agency, therefore they can distribute as they see fit. Super Representatives are not obligated to pay out, and individual participants can vary in their generosity.

The 100 nodes that just miss the top 27 Super Representative spots are called Super Partners and are rewarded in proportion to how often they vote.

How to stake Tron

Tron's system is complex, especially for newcomers to crypto, so we recommend using Tron's proprietary blockchain explorer TronScan. To link to the TronScan website and stake TRX, users must be holding TRX within a Tron compatible wallet, such as Tronlink or Ledger.

Stake TRX with Ledger

Use Ledger Live to securely stake Tron and other assets from your hardware wallet.

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Users must freeze (stake) their TRX holdings for 3 days to become accepted as a node on the Tron network. Only then will they be eligible to take part in the voting process.

One frozen TRX token equals one vote. Votes are invalidated if you unstake and remove your TRX holdings.

The procedure is as follows:

1. TronScan. Go to TronScan's Representative's page.
2. Connect wallet. Link your wallet via the "Connect wallet" button at the top right of the screen.
3. Vote access. Click the green "Vote" button
4. APR. Click at the top of the "APR" column.
5. Tron Power. Before being able to vote for a preferred candidate node, you will need to freeze (stake) your TRX tokens for 3 days. Frozen TRX tokens equate to Tron Power (voting power). Click "Obtain TRON Power" on the dashboard. This will provide an option to freeze your TRX holdings. Enter the amount you wish to stake and confirm the transaction in your TronScan wallet.
6. Voting. After your TRX tokens have been frozen for 3 days, head over to the "Vote" tab and distribute your TRX voting tokens amongst your preferred Super Representative (candidate) nodes. Enter the amount of tokens you want to contribute and click "Vote". Confirm the transaction in your TronScan digital wallet.Don't worry about bandwidth points or energy at this point: these are to do with paying for transactions or other network activity.
7. Rewards. To claim your rewards, distributed by Super Representatives, click on "Personal Assets".
8. Claim. Click the button that says "Claim Reward". Your reward will then be credited to your wallet. Some Super Representatives instantly distribute.

Your available TRX balance and frozen (staked) TRX balance will be visible in your TronScan wallet.

How much can I earn with Tron staking?

With the Super Representative model, determining how much a user can earn is hard to predict with accurate precision.

The default setting promotes the Super Representative to keep 20% of their own reward and distribute the remaining 80% to their voters. But as previously discussed, this is not mandatory.

The reward for creating each block is 32 TRX, but this can be multiplied by the number of blocks per election and the number of daily elections. The maximum number of TRX rewarded daily is 4,608,800 TRX. This calculation assumes the Super Representative node is part of the chosen 27 for all 4 daily elections.

The rewards a voter receives are determined not only at the discretion of the Super Representative, but by the proportion of the total votes cast. Information on the Super Representatives is available on TronScan.

Finally, what a user receives in terms of market value is determined by the market price of TRX.

Is staking Tron safe?

Staking any cryptocurrency requires connection to the Internet and use of underlying smart contracts, which means it is impossible to achieve total, complete and permanent security. However, a user can mitigate those risks with a few simple techniques:

• Backup your important files to at least one separate hard drive.
• Never share your private key with anyone.
• Encrypt your main wallet.
• Keep a hard copy of your private key in a secure place.
• Use a different device for staking to the one you use for everyday activities, especially email.

Pros and cons of staking Tron