Staking SOL tokens with Phantom wallet
This step-by-step guide will instruct you in the process of how you can create a Solana wallet and then stake your SOL token on the Solana blockchain with the use of Phantom wallet.
All the screenshots and values visible in this manual, in particular the accounts balances and mnemonic phrases are example data only, presented to show how the mechanisms work and as such they should not be taken into account in real applications.
1. Creating Solana wallet
Phantom wallet is a browser addon. It supports 4 browsers now: Chrome, Firefox, Edge and Brave. Use one of those browsers and go to Phantom website. We will use Firefox in this guide. On the main page of Pantom wallet website click “Add to Firefox” button and install addon.
When addon is installed a new icon will appear in the tool bar. Click this icon and then choose “Create new wallet”. In the next step Secret Recovery Phrase will be displayed. This is most important step. Copy that phrase and store it in safe place, do not share it with anyone. Next set up a password to add additional layer of security to your wallet and click “Save”, and then “Finish”.
IMPORTANT! The Secret Recovery Phrase is a critical data safeguarding your account. Copy it and keep it in a safe place, do not share it with anyone. Anyone who gets access to it will have full access to your wallet and will be able to withdraw as much as they like. Losing a Secret Recovery Phrase will result in you losing access to your wallet and there is no possibility of Secret Recovery Phrase recovery.
Your wallet is ready, you can now see your address and account balance. To make management easy add Solana to your token list. To do so click “Manage token list” button, search for Solana and trigger the switch. Then click “Close” button to return to main page of the wallet. Now SOL token will be listed here.
In order to perform any actions such as staking, you need to transfer some funds to your Wallet Account. Send some SOL tokens, e.g. from the exchange on which you bought them. Click Solana on your token list and then “Deposit” button to display your wallet address as QRcode. You can also use “Copy” button to copy the address to clippboard.
2. Creating & delegating your Stake Account
After successfully adding funds to your Wallet Account, you may proceed to create a Stake Account. On the main screen select Solana on your token list and choose “Start earning SOL” button.
Next step is to choose a validator. You can search for specific validators by their name. Once you have chosen a validator, click on its name to step forward.
Next choose the amount you want to stake. Then this amount chosen will be transferred into your Stake Account. Do not stake all your tokens. Make sure to leave small amount of SOLs in your Wallet Account in order to pay for transaction fees — this is really important! Next click “Stake” button and wait for confirmation from the network.
You can find your Stake Account by clicking Solana on the token list. Please note that your delegated SOL tokens will start earning rewards once the Warmup Period has concluded. This process usually takes one epoch (~2–3 days). Until this happens, your Stake Account will be marked with „Activating” status. The progress of the current epoch can always be checked on solanabeach.io.
What is important is the fact that you as a token-holder have the means to increase the overall security and therefore the overall value of the network. This can be achieved through enhancing decentralization by delegating your stakes to smaller validators. Should you wish to do it with success, you need to create more than one Stake Account and distribute your funds across these Stake Accounts. Remember to always make sure to leave some SOL tokens in your Wallet Account to pay for transaction fees.
Repeat the above process for every Stake Account you want to create and delegate. Click the “+ Create account” button in the Staking menu to start the process.
3. Managing stakes
At the beginning of each epoch the staking rewards are automatically accumulated and re-delegated on your Stake Account. In order to check your staking rewards, click on Solana on your token list, then clik on “Your Stake” option and select stake account to see your rewards per epoch.
Delegating more SOL tokens
If you wish to increase the amount of SOL that you are delegating to a specific validator, it is recommended that you create another separate Stake Account which then you delegate to the selected validator. To do so, go to “Your Stake” section and click “+” icon in upper right corner.
If you send SOL to a Stake Account that is already delegated, please note that the new funds are not automatically delegated. First you would need to undelegate the Stake Account, next delegate again in order to have the new funds delegated too. It is worth remembering that during the Cooldown or Warmup Period you will not earn any rewards.
Withdrawing SOL tokens from stake account
If you want to cancel staking and withdraw your tokens you have to undelegate your stake firt. To do so click on Solana on your token list, go to “Your Stake” and select stake account to you want to deactivate. On the account screen simply click “Unstake” button
Once the unstaking process has started, the respective Stake Account will have a new status assigned, namely „Deactivating”. For the time when your account is deactivating, your funds are illiquid. This is considered the Cool Down Period.
Once the Cooldown Period has ended (~2–3 days), the status of your Stake Account will change to „Inactive”. Then you can withdraw the undelegated funds from your Stake Account to your Wallet Account.
In order to do so, simply choose the respective Stake Account and click „Withdraw Stake”. All your funds will be trasfered from stake account to your wallet.
Warmup and Cooldown Periods
The Warmup and Cooldown period refer to the state of your Stake Account.
The Warmup Period describes the time between the moment you issue the delegation transaction and the moment that your Stake Account is fully delegated and starts to earn rewards. Between these two phases, your Stake Account is considered to be „activating”. The Cooldown Period describes the time between the moment you issue the undelegation transaction and the moment that your Stake Account is fully undelegated. Between these two points, your Stake Account is treated as „deactivating”, it does not earn rewards anymore and the funds are illiquid.
A change to the state of your Stake Account is only considered by the protocol at the beginning of an epoch. This means, that if you change the status of your Stake Account, you will have to wait until the new epoch starts for the change to come into effect. Since an epoch lasts ~2–3 days, you have to wait for the current epoch remaining time to pass in order for your changes to become effective – the exact duration of the remaining time depends on when you commenced the changes to the state of your Account.
There is a certain threshold of 25% of the total stake across the whole network that can change state in one epoch. In case this threshold is exceeded, you would have to wait for an additional epoch until the exceeding portion of your stake has successfully changed state.