Before you start with this guide, this is not a financial advice and I do not recommend it for newbies. This is only brief summary of staking. This guide does not contain everything. You will have to do DO YOUR OWN RESEARCH (DYOR).
Disclaimer: I am not a financial advisor. Invest at your own risk. Whatever you do with your own finances is your responsibility, so invest wisely. The main purpose of this article is for education.
Introduction: What is staking?
With DeFi mania, staking get very popular. Briefly staking is the process, when the holders lock their crypto(altcoin) into a smart contract to participate in validation process for example to secure operations of a blockchain network or to validate the transactions. The protocols randomly assigns the right to validate the next block. This is not exactly random, cause the more coins locked in the validator, the higher probability that the holder will be rewarded for validation.
What to stake?
Which coin should I stake? The coins selection for staking depends on potential holders risk acceptance. If holder prefer safer option and less risk, than he/she would probably go for staking some major, well known altcoin for example binance coin(BNB).
What are the risks of the staking?
Price movement in the asset they are staking. Let s say that holder is earning 20% APY. But if the price drop more than 20% throughout the year. The holders will still made a loss. This is very risky if the assets were bought on ATH. In my opinion the best time to stake is in the bear market and buying with cost averaging method if holders do not have enough knowledge to know when to buy.
This risk is only considered if holder is staking micro or very low cap altcoin that barely had any liquidity on CEX or DEX. For example, when holder stake some micro altcoin and the only way how to trade this altcoin is through pancakeswap, then for example if liquidity get taken out by somebody then holder will not be able to swap it for another coin. It is recommended for pancakeswap liquidity to check if liquidity put in by developers of the project is locked and at least audited by some company (if the potential holder for altcoin is not able to check the smartcontract himself)
Fixed lockup period
Some stakable assets come with fixed locked period. In this period, holders cannot do anything with their assets or in some scenario they still can unlock their altcoins, but that will affect overall return. It is recommended for investor to lock their altcoins only if they are doing it for long term and they believe in the future of the project.
How should I transfer my fiat to cryptos?
The best option at the moment that I know is that you transfer money from financial technology company Revolut to Binance through SEPA. It is very fast taking approximately 5–10minutes. Fees are none for EURO transfer. If Revolut is not the option in your country, you will have to use classical bank transfer or bank card etc.
Before we begin, we should download Trust Wallet, you can download it from their official site to avoid getting fake trust wallet( https://trustwallet.com/) . Later on when TWT is downloaded, you will have to create your wallet. So there will be phrase key generated exactly for you wallet.(Do not forget to write them somewhere safely). If you already have the wallet, you will just input your phrase key.
Trust wallet staking
Is the operation, when you lock your crypto into validator for fixed period. For example for BNB which we will be doing, the reward will be distributed automatically after 3 days of staking. You will get the rewards as long as your chosen validators is active. That is the reason, why it is recommended to choose one of the top validator for staking.
Validators on BSC work similar to Ethereum consensus protocol for Ethereum network, they take turns to create blocks in BSC network. Used for powering the BSC network through validation of transactions. The validator which validated the transactions will be rewarded with transactions fees.
2.Buy BNB-fast and cheap for transfer
3.Send to your Trustwallet address(I recommend to use BEP2 network for transfer), if you want to stake BNB on Trust wallet