Now you can also use AION to help secure the network by staking— and earn more AION as a reward!
This is intended to be a quick zero-to-staked guide in 3 steps:
- Buy AION
- Store AION in a Wallet
- Stake (“Delegate”) Your AION
But first, let’s look at the economics of staking (or skip the next section to get straight to the guide):
AION’s tokenomics are stable while staking rewards are dynamic.
A block is added to The OAN’s blockchain about every ten seconds. The validator (POW miner or POS staker) who successfully adds a block to the chain receives a 4.5 AION reward plus the transaction fees in the block.
This means the total supply of AION increases about 14.2MM AION per year, every year. This also means that the rate of inflation (percentage increase of total supply) goes down every year — Year 1 (2020) inflation will be about 3.01%, while Year 2 is 2.92%, and Year 3 is 2.84%, and so on. Over the next year (through November 2020), circulating supply will increase from about 371MM to about 487MM as the 3-year Token Release Schedule (TRS) comes to an end.
Since block production is split evenly between miners and stakers, this means about 7.1MM AION in block rewards goes to stakers annually. Rather than competing for block production with computing power like miners, stakers have a chance to add a block (and earn the block’s reward and transaction fees) based on the staker’s amount staked versus the total amount staked network-wide. The lower the total amount staked network-wide, the greater the rewards for those who are staking. The OAN’s target staking participation rate is 30% of the total supply (about 141.4MM staked of about 471MM AION total supply currently) for an annual rate of return of about 5%, but the participation rate is expected to vary over time.
The current annual rate of return (in AION) is calculated by dividing the 7,095,600 AION in staking block rewards per year by the total amount staked. The total amount staked can be viewed through the staking registry contract address. Aion Smart Stake created a staking calculator to estimate rewards.
1. Buy AION
You can buy AION on cryptocurrency exchanges. The process for signing up for an account and trading on an exchange varies, and you should review the instructions provided by the exchange before use. The following exchanges (and more) currently support AION:
It is important you choose an exchange you trust with reasonable prices, liquidity, and volume. As always, you should research your options to find what will work best for you.
2. Store AION in a Wallet
In order to stake your AION, you need to withdraw it from the exchange to a wallet whose keys you control. There are many AION wallet options to choose from, including:
UPDATE: In fall 2020, the new my-Aion.TheOAN.com wallet was released, featuring a built-in staking interface & block explorer (Ledger compatible):
- Instructions— docs-aion.theoan.com/docs/my-aion-wallet
- Walkthrough Video by Yashnik — youtu.be/CGoVRSb5DW4
- Review by Savage Mine — youtu.be/pQWj1AlJljw
Ledger Hardware Wallet — link.medium.com/2hUcRp0au1
- Instructions — docs-aion.TheOAN.com/docs/ledger-hardware-wallet
- Set-up video walkthrough — youtu.be/5fGRbBGxl2E
- Set-up instructions from Ledger — support.ledgerwallet.com/hc/en-us/articles/360008599834-Aion-AION-
Aion Desktop Wallet (Ledger compatible) — link.medium.com/7zl8TjXau1
- Latest Release — github.com/aionnetwork/Desktop-Wallet/releases
- Instructions — docs-aion.TheOAN.com/docs/aion-desktop-wallet
Makkii Mobile Wallet (Ledger compatible) — link.medium.com/tskqDEabu1
- for Android — play.google.com/store/apps/details?id=com.chaion.makkii
- for iOS — apps.apple.com/us/app/makkii/id1457952857
- Instructions — docs-aion.TheOAN.com/docs/makki
MagnumWallet.co (Ledger compatible)
- How to manage AION on Ledger using Magnum Wallet — link.medium.com/dRGQyt5au1
The recommended wallet for staking is Ledger, which can be managed through the myAION web wallet, Aion Desktop Wallet, Makkii Mobile Wallet, and Magnum Wallet applications. Ledger is considered the safest option because your private key and mnemonic seed phrase (which are used to authorize transactions) remain on the hardware device and unexposed at all times.
Makkii Mobile Wallet is currently the only mobile wallet application with an in-wallet staking interface (under “Discover” in the bottom menu in Makkii).
You can also stake using any AION-supporting wallet with your encrypted keystore file, private key, or mnemonic seed phrase. The process to export or access this information from your wallet varies, and you should review the instructions for your wallet before use. Please note that any of these three methods has key exposure risks: if your encrypted keystore file is intercepted and your password is cracked, or if your private key or mnemonic seed phrase is intercepted, a hacker would have full access to your account. The keystore method is somewhat safer than the other two because a hacker would need both your encrypted keystore file and the decryption password to get access to your keys. Use these methods with due caution, and only use on devices you trust that are regularly scanned for malware and viruses.
3. Stake (“Delegate”) Your AION
The Open Application Network has released a simple staking interface for users to stake by delegating their AION to one or more staking pools:
Thorough documentation about staking is available here: docs-Aion.TheOAN.com/docs/staking
NOTE: Staking can also be done through the new my-Aion.TheOAN.com web wallet or Makkii mobile wallet. While similar, the instructions below are specific to the staking interface. Instructions for myAION and Makkii are linked in the previous section.
This guide will just cover the basics of the staking interface:
- A. Sign In
- B. Choose a Pool
- C. Delegate
A. Sign in
To begin, you need to connect your wallet to the staking interface.
If you are using a Ledger hardware wallet, you can sign in through the staking interface website from any computer or through the Linux & PC staking interface desktop application (downloads available on the “Sign In” screen). Both the Nano S and Nano X are compatible. Plug your Ledger into your computer, enter your PIN, and select the Aion app on the device. “Contract data” must be enabled in the Ledger settings. Then complete your sign-in on the staking interface.
Chrome browser is required for the staking interface website. If you have trouble using the staking interface website, you may have better results with the staking interface desktop application for PC and Linux, instead. Also, you have to be pretty quick with confirming a transaction on your Ledger using the staking interface — you will get a white screen error if you confirm too slowly.
If you are using Makkii, you can sign in to the app, select “Discover” in the bottom menu, then select “Aion Staking” to access the staking interface.
If you are using your keystore file, private key, or your mnemonic seed phrase, you must use the staking interface desktop application for additional security. You can download the staking interface desktop application for your operating system on the staking interface website sign-in screen.
B. Choose a Pool
After you have signed in to access your wallet, click on the “Staking” tab on the left menu of the interface. You will be shown a list of staking pools and information about each pool, including their name, status, fees, and performance.
Take some time to research a pool before you delegate to it. You can only stake to Active pools. In the interest of decentralization, you may wish to choose a pool with a lower Stake Weight %, which is the ratio of the amount staked to the pool to the total amount staked network-wide. Better Performance means the pool is producing around or above the expected number of blocks based on its Stake Weight %, but this metric is not a perfect measure of pool uptime and can swing quite a bit, especially for smaller pools. Higher Fees means the pool takes a larger percentage of your rewards. Self Bond indicates how much AION the pool is staking to itself, which determines its maximum Capacity (how much can be delegated to it). Review the pool’s website to get a sense of who is behind the pool, its operations, and its contributions to the AION community. You may choose to delegate to one or multiple pools to diversify your stake allocation.
Once you have chosen the pool(s) you wish to delegate to, click the “Delegate” button for that pool on the far right.
On the next screen, enter the amount you wish to delegate, review the pool information, click the “Delegate” button in the lower right, and confirm the transaction.
Leave a little AION in your wallet balance (0.5 is more than enough) to cover future Withdraw and Undelegate transaction fees.
And that’s it! You are now contributing to The Open Application Network’s security while earning more AION!
I’m Staked — What Happens Now?
The entire staking process is handled by smart contracts. Although you delegated your stake to a particular staking pool in the staking interface, the AION delegated (and any rewards earned by you based on that delegation) are held and managed by audited smart contracts deployed by The OAN. Only you can control your delegations and rewards using your keys; neither The OAN nor staking pools have the ability to withdraw, transfer, or control your AION in the staking smart contracts.
Rewards will accrue as the pools you delegated to produce blocks for the network. You can view your accrued rewards in the staking interface. If you wish to move your staking rewards from the smart contract to your wallet, you must Withdraw them using the staking interface. If you wish to move AION that you delegated to a staking pool to your wallet or another staking pool, you must Undelegate them using the staking interface. Undelegate transactions take 8,640 blocks (about 24 hours) to finalize. Because Withdraw and Undelegate transactions are smart contract transactions, there is a small transaction fee required to complete the transaction on the network. Make sure you leave a small balance in your wallet to pay for these fees — otherwise, the buttons for these options will be grayed-out in the interface.
- AION Twitter — twitter.com/Aion_OAN
- AION Blog — blog.Aion.network
- AION Messari page— messari.io/asset/aion
- The OAN Twitter — twitter.com/OpenAppNetwork
- The OAN Blog — blog.TheOAN.com
- The OAN YouTube — youtube.com/TheOpenApplicationNetwork
A more comprehensive list of resources for holders, stakers, miners, and developers is available on the Reddit Wiki.
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If you need technical support, please contact the Help Desk.
None of the above is offered as legal or financial advice. While the author is an attorney, he is not your attorney, and you should always consult with someone one-on-one regarding the particulars of your situation before making any significant legal or financial decisions.
This article contains forward-looking statements that address future events and conditions which have not yet occurred, inherently involve known and unknown risks and uncertainties, and are subject to factors outside of the author’s control. Actual events and conditions may differ materially from those expressed herein. Past performance does not imply or guarantee future results. Do not rely on any statement herein as a guarantee that any future events or conditions will exist or the performance of any investment will be impacted thereby in any way.
The author holds Aion and Ether.