Icon is a blockchain network designed to enable interoperability between independent blockchains. It aims to connect both public and private blockchains through its loopchain technology. The native token of Icon is ICX, which serves as the currency in its ecosystem.
ICX allows for staking to earn passive income. Staking involves locking up ICX tokens to help validate transactions, while earning staking rewards over time for supporting the network. Let’s look at how to stake ICX and start earning yields.
Step 1: Obtain ICX Tokens
First, you’ll need to acquire some ICX tokens. The main way is to purchase ICX on a cryptocurrency exchange like Binance, KuCoin or Gate.io. Make sure to withdraw your newly purchased ICX to a non-custodial wallet where you control the private keys. This allows you to stake your tokens.
Step 2: Select an ICX Wallet
You’ll need to use a compatible wallet to stake ICX. The best options are Icon’s native wallets:
- Iconex — Icon’s desktop wallet for Windows, Mac and Linux. Easy to use with Ledger support.
- IconFi — Icon’s mobile wallet for iOS and Android. Convenient on-the-go access.
These provide the functionality to stake ICX directly from your wallet. Import your ICX withdrawal into your chosen wallet.
Step 3: Delegate ICX for Staking
Within your ICX wallet, look for the “Delegate” feature. Here you can select a Public Representative (P-Rep) to delegate your tokens to for staking. P-Reps run nodes that validate transactions on the Icon network.
Consider factors like the P-Rep’s commission rate, server specs and community contributions when selecting who to delegate to. Input how many ICX tokens you want to stake and confirm the delegation.
Step 4: Claim ICX Staking Rewards
As your selected P-Rep validates transactions, you’ll accrue ICX staking rewards over time. Most P-Reps distribute rewards daily. You can claim them to your wallet by clicking “Claim Rewards” in the delegation screen.
Rewards will then be added to your wallet balance. The APY yield for ICX staking is around 8-12% currently. Continue claiming periodically and compounding rewards to maximize earnings.
Step 5: Consider Tax Implications
Depending on your country’s tax laws, staking rewards may constitute taxable income. It’s a good idea to consult a tax professional to properly account for staking yields on your taxes. Proper reporting will avoid legal issues when tax season comes around.
Staking ICX is an easy way to put your holdings to work generating passive income. By contributing to the security of the Icon network, you can steadily grow your ICX balance over time through staking rewards. Just purchase ICX, delegate through a compatible wallet, periodically claim your yields, and compound the rewards. ICX staking provides attractive consistent returns on the road to long-term wealth creation.