SQD Staking on Subsquid: A Quick and Easy Tutorial

What is SQD Staking?

SQD staking involves delegating SQD tokens to network workers, which incentivizes and rewards node operators for contributing computation and storage resources. This system helps curate trustworthy operators and allows SQD token holders to participate in governance by voting on protocol changes and proposals.

This article will serve as your staking guide, helping you familiarize yourself with the SQD staking process, providing a step-by-step tutorial, tips to choose a reliable SQD validator, and offering network-specific details such as fees and lockup periods.

How to Stake SQD?

Follow these steps to stake SQD via a crypto wallet.

Step 1: Prepare a supported Subsquid wallet

Stake your SQD tokens using wallets, such as MetaMask. Install the preferred browser extension as a Subsquid wallet and deposit your SQD tokens into this wallet before continuing to the second step.

Step 2: Start staking SQD

Navigate to the Subsquid Network App.

Enjoy the video tutorial or follow the step-by-step guide below.

Step 3: Connect your Subsquid wallet

Connect your wallet. Allow the application access, if you’re visiting the website for the first time. If you're using MetaMask the app will guide you to add and switch to a supported network.

Step 4: Select the Subsquid worker

Select the “Dashboard” to view the list of workers. Choose a preferred worker, supporting your decision with worker providers included in our Staking Rewards Verified Staking Provider (VSP) Program.

Step 5: Delegate SQD tokens

Click “Delegate” next to the selected worker. Enter the amount of SQD you want to stake.

Step 6: Stake SQD

Finalize the staking process by clicking “Delegate” and confirm the transaction in your wallet.

How to Choose Subsquid SQD Validators?

Ensuring users stake their PoS tokens with dependable and high-performing validators is crucial. To facilitate this, we introduced our Staking Rewards Verified Staking Provider (VSP) Program in June 2022. This initiative involves meticulous evaluation of potential validators, assessing factors like security protocols, on-chain reliability, provider infrastructure, and ecosystem contributions.

Additionally, when choosing a validator to delegate to, consider alternative metrics:

Commission: Workers charge a commission rate, representing the percentage of rewards they retain. High rates result in lower rewards, while low rates may signify potential profitability issues for the worker. Note that commission rates can fluctuate.

Number of Users: The number of delegators can significantly influence the decision of which worker to delegate to because it impacts rewards, network security, and the validator's reputation. Workers with more delegators enhance network security and are perceived as more reliable, while a higher combined token delegation from users lowers the rewards.

Staked Balance: The amount of tokens delegated to the worker influences the rewards. There is a sweet spot, as none of the extremes result in higher returns. Currently, both the worker and its delegators are rewarded the most when the total delegated SQD count is around 20,00-30,000. Anything more or less means fewer rewards.

Performance: Opt for workers with optimal performance metrics, including uptime. It's advisable to select workers with uptime exceeding 99% and a proven track record of avoiding slashing penalties.

Delegation Capacity: To maximize rewards, delegate to high-quality but lesser-known workers. Seek out workers with a high uptime percentage and significant available delegation capacity. The Delegator APR decreases significantly once more than 20,000 SQD is delegated to the worker.

How are SQD Staking Rewards Generated?

SQD rewards come from a pool that received 10% of the total supply at TGE, amounting to 133,700,000 SQD. Each epoch unlocks rewards from this pool, which are distributed to workers and delegators through the Reward Manager's on-chain claim commitment.

For the first three years, the reward cap is fixed, after which it decreases until governance decides on a new inflation schedule. This system allows the community to make informed decisions on future SQD issuance based on historical data. The reward rate depends on network utilization and staked supply, with rewards distributed to workers and delegators, and any remaining rewards split between burning and the treasury.

You are welcome to experiment with our SQD Staking Calculator to get a better understanding of how these metrics can influence your rewards. The APY staking calculator and SQD rewards over time are great tools for this purpose.

SQD Staking Details

• View the current Subsquid staking APR here
• Use the Subsquid Staking Calculator to estimate your rewards
• Lockup: no lockup
• Average commission rate: 75%
• Minimum amount required for staking: no minimum

Track your staking portfolio

Track the current and historical reward rates, validator count, number of unique Subsquid staking wallets, and the staking ratio of the Subsquid network by visiting the Subsquid Asset Page. Track SQD staking APY and delegations. Understanding these relevant data points, including SQD stats and analytics, is essential to make better staking decisions. Predict your future returns with the SQD Staking Calculator. To learn how these data points could impact your staking rewards, please read more in the FAQ section on the Subsquid Asset Page.

Delegators can monitor their delegations and token holdings using the Subsquid Network App in the corresponding Delegations and Assets tabs. In addition, stakers can determine the state of their tokens and whether they are transferable, locked, claimable, bonded, or delegated.

How to Unstake SQD?

To unstake your SQD tokens, follow the video tutorial or the steps below:

Step 1: Go to the SQD staking platform

Open the Subsquid Network App.

Step 2: Connect your Subsquid wallet

Connect the wallet you staked with previously.

Step 3: Manage delegations

Navigate to the “Delegations” tab to view your staked positions.

Step 4: Undelegate SQD

Click the "Undelegate" button and enter the SQD amount you want to unstake.

Step 5: Unstake SQD

Finalize the unstaking process by clicking “Undelegate” and confirm the transaction in your wallet.

Maximizing SQD Staking

Maximizing Subsquid staking rewards revolves around finding the optimal balance between workers’ uptime and delegated tokens. To maximize your rewards, delegate to high-quality but less well-known workers with high uptime and ample free delegation capacity. The optimal rewards are achieved when the total delegated SQD is around 20,000-30,000. Delegating more or less than this amount results in reduced rewards for both the worker and the delegators.

Stake More

You can increase your stake by delegating more SQD to workers. You can decide whether to stake with the same Subsquid worker or diversify your delegation across several providers.

Conclusion

Staking is essential to Proof-of-Stake blockchains and comes with many benefits for investors and the network, including the potential for passive income.

• Investors earn yield from token emissions and/or transaction fees.
• Stakers become eligible for airdrops as many networks prioritize granting these benefits to them.
• Staking helps to secure the network
• Staking from multiple participants helps decentralize the network
• Stakers can participate in governance, as many PoS networks allocate governance rights based on the number of tokens staked.

Congratulations! You are now not only getting the most out of your investment with compounded returns. YOU are also (in-)directly contributing to the decentralization, and the network security of Subsquid and thus contributing to the long-term success of your investment! Subsquid needs active stakers like you to become successful in the long term.

Now share the tutorial with your friends so they can get to start staking as well!

Lastly, don’t forget to check out the Subsquid Asset Page for more insights into staking SQD, and drop us a message if you find this tutorial useful. Happy staking!