Protocol staking on Ether and Solana: two economic models compared

Marketing communication

How staking rewards are generated and why they differ between the two networks.

Protocol staking on Ether and Solana is often described as passive income, but it is something more specific: the reward paid to those who help keep a Proof-of-Stake blockchain running. Understanding where that yield comes from, and why it differs between the two networks, is the first step toward evaluating it properly.

Staking is not interest, but paid work

In Proof-of-Stake networks, updating the blockchain does not require the computing power of mining, but a commitment of collateral. Participants lock up an amount of the same crypto-asset, as a guarantee of the honesty with which they will carry out validation. The larger the stake, the greater the involvement in the network and the corresponding reward.

The logic is based on penalties: a validator that misbehaves may lose part of the crypto-assets staked as collateral. This is where protocol staking clearly differs from simply holding. The yield is not interest granted by an intermediary, but compensation for a service provided to the protocol, which at the same time strengthens its security.

This holds even when staking is entrusted to an operator such as CheckSig: rewards are not interest paid by CheckSig, but are generated by the protocol in return for the validation activity carried out by CheckSig, and are credited to the client net of the fees set out in the economic terms.

Ether and Solana: why the highest yield is not always the best

Solana issues new tokens at a rate of around 3.6% per year, gradually declining toward a long-term floor of 1.5%. Net of this dilution, the real yield shrinks significantly. Ether follows the opposite logic: issuance well below 1% per year, and lower nominal rewards. The comparison concerns the share held in the network, not the euro value, which depends on the market price.

The comparison thus reveals two distinct economic models.

What this means for Ether and Solana holders

Operational differences remain. Ether requires 32 ETH to activate a validator: with CheckSig’s staking service you can take part with smaller amounts too. Each client’s crypto-assets remain segregated and attributed to them; rewards are credited in proportion to the amount staked.

Seen in this light, protocol staking can offset, in whole or in part, the dilution of your share caused by the issuance of new tokens.

These are technical details, but they affect risk profile and liquidity. Deactivating staking is not immediate: timing depends on the protocol and, for Ether, on the validator exit queue, which is variable. The question, then, is no longer just how much staking yields or how it works, but which network rewards the work of those who support it more sustainably.

Disclosures. This content is for promotional purposes. Crypto-assets are subject to high volatility and their value may fall significantly. Staking rewards are not guaranteed: they vary depending on protocol parameters, overall network participation and validator performance, and are paid in crypto-assets, not in euro. Staking involves technical and operational risks, including protocol penalties (slashing) and unlocking times that may limit the availability of crypto-assets. Past performance is not indicative of future results. Before subscribing, please read the Terms of Service and the economic terms.