How to stake Cardano on Daedalus? (PoS mechanism)

Understanding Cardano's Proof-of-Stake Consensus

1. Cardano operates on a pure Proof-of-Stake (PoS) protocol named Ouroboros, which was formally verified using peer-reviewed cryptographic methods.

2. Unlike energy-intensive Proof-of-Work systems, Ouroboros selects slot leaders probabilistically based on the amount of ADA staked and the randomness derived from blockchain history.

3. Stake pools are run by operators who maintain infrastructure, while delegators retain full ownership and control of their ADA at all times.

4. Rewards are distributed every epoch—approximately every five days—and calculated based on pool performance, saturation level, and operational margin.

5. The protocol enforces strict decentralization parameters, including dynamic pool saturation thresholds and mandatory pledge requirements to prevent centralization risks.

Prerequisites for Staking via Daedalus

1. A fully synchronized Daedalus wallet must be installed and updated to the latest stable version compatible with the current Cardano network era.

2. Users need to hold a minimum balance of ADA in their wallet—no specific lower limit exists, but transaction fees and reward thresholds apply in practice.

3. An active internet connection and sufficient local storage are required, as Daedalus downloads and verifies the entire blockchain ledger.

4. Two-factor authentication is not enforced by the wallet itself, but users are strongly advised to back up their 24-word recovery phrase in an offline, secure location.

5. Network time synchronization must be accurate; significant clock drift can prevent proper wallet synchronization and delegation registration.

Step-by-Step Delegation Process

1. Launch Daedalus and wait until the wallet displays “Fully Synced” in the bottom-left corner.

2. Navigate to the “Delegation Center” tab located in the left-hand sidebar menu.

3. Click “Choose Pool” to open the stake pool browser, where filters such as ROI, saturation, margin, and pledge can be applied.

4. Select a pool by clicking its name, then review its metadata—including ticker, description, operator contact, and live performance metrics.

5. Confirm delegation by entering your wallet password and clicking “Delegate”. A transaction fee of 0.17 ADA is deducted immediately.

Reward Distribution Mechanics

1. Rewards begin accruing after the delegation certificate is included in a block, typically within one to two epochs.

2. Each epoch’s rewards are automatically compounded into the staking balance unless manually withdrawn—a process requiring a separate transaction.

3. Undelegating does not trigger immediate withdrawal; funds remain delegated for up to two full epochs before becoming available for movement.

4. If a stake pool fails to produce any blocks during an epoch, no rewards are distributed to its delegators for that period.

5. Rewards are denominated exclusively in ADA and appear as separate entries in the transaction history labeled “Staking Reward”.

Frequently Asked Questions

Q: Can I delegate to multiple stake pools simultaneously from one Daedalus wallet?A: No. A single wallet can only delegate to one stake pool at a time. Splitting stake across pools requires separate wallets or third-party tools outside Daedalus.

Q: Does staking lock my ADA or restrict sending transactions?A: No. Your ADA remains fully liquid and transferable at any time. Delegation is a non-custodial, off-chain signaling mechanism.

Q: Why does my Daedalus wallet show “Not delegating” even after completing the process?A: This usually indicates the delegation certificate has not yet been confirmed in a block. Wait for at least one confirmation and ensure the wallet is fully synced.

Q: Are staking rewards subject to taxation in my jurisdiction?A: Tax treatment varies by country and depends on local regulations regarding income, capital gains, or property classification of crypto assets.