An In-Depth Guide for Staking or Delegating Your Terra Money Assets
PLEASE NOTE!!! The blockchain network mentioned in the article is the previously known Terra Money network, now Terra Classic and the predecessor of Terra 2. Terra Classic was essentially an algorithmic stablecoin project, which failed in May 2022, with the UST Classic depeg. On May 25th, 2022, Terra Classic users passed governance proposal 1623, which outlined the genesis of the new Terra chain.
It has been a while since we last discussed Terra Money, and thus, we figured it was time to share a step-by-step guide on staking $LUNA with you. But first, a little refresher, what is Terra Money?
Terra Money is a well-known blockchain protocol supporting stable, programmable payments and open financial or DeFi infrastructure development. Among the most famous products of the Terra ecosystem sits a whole range of fiat-pegged stable coins, which are algorithmically stabilized by native asset $LUNA. Terra aims to replace the complicated payments value chain, such as credit card networks, banks and payment gateways, with a single blockchain layer. Furthermore, the network provides payment channels for both merchants and consumers and is well-known for its continuous development of new tools and other technologies to improve the financial infrastructure such as Mirror and Anchor protocol. For further information on Terra Money, visit our introduction article or watch the video below.
As we mentioned earlier, $LUNA is Terra Money’s native asset. Luna serves as a foundational asset for the entire Terra network and ecosystem by collateralizing the mechanisms that secure the price-stability of Terra stablecoins and modulate the incentives of validators.
LUNA’s primary function is to protect the integrity of the Terra mechanisms by locking value within the Terra ecosystem through staking. When providing network security, Luna holders and delegators can earn rewards for exposing themselves to the risk and to offer incentives to the long-term interest in Luna ownership. In Terra, the staking rewards are first distributed to validators who take a commission for providing their operations and then are withdrawn individually by delegators. Rewards from stake are primarily determined by the size of the stake and are structured in a way that rewards increase as transaction volume increases.
So, now that you know all that. It’s time to get started with Luna. First, if you don’t have a wallet holding Terra yet. We recommend using the Terra Station Wallet, which you can download as:
- Desktop Wallet: https://station.terra.money/wallet
- Chrome Extension: https://chrome.google.com/webstore/detail/terra-station/
Getting Started With Terra Station Wallet
Once you have downloaded the desired wallet version, open the wallet and select “create new wallet”. To create your account or wallet you’ll have to fill out your wallet name, password, confirm the password and write down the seed phrase. Please make sure to store your seed phrase somewhere secure and preferably offline. As without your seed phrase you won’t be able to recover your wallet and thus assets.
Select “Next” to continue after writing down your seed phrase. You will be asked to confirm your seed phrase by filling out some of the words. Select “next” once again and the Terra Station dashboard will open (see image below).
As you can see, the wallet is empty. So, before we can begin to stake transfer your $LUNA assets from another wallet or exchange to Terra Station. Your public address will be shown at the top of the dashboard, copy that to transfer.
Let’s Get To Staking!
After you’ve transferred LUNA to the wallet, on the left menu, select “Staking”.
A new dashboard should open, which looks like the one below.
As you can see, you will be able to see the LUNA available for delegation, your delegated assets, undelegated assets and the rewards that you have earned.
You’ll also see a list of available validators. Select the validator of your choice by clicking on their name. Next, the details for the validator will appear (see image below).
Select “delegate” in the bottom left menu, to stake your assets.
A pop-up will appear. Double-check your wallet address as well as the address that you’d like to delegate to. Next, fill out the amount of $LUNA that you’d like to delegate and select “Next”.
Double-check all the details and select “Next” if everything is correct.
Insert your password to confirm, and that’s all folks! You have now staked your Luna assets! Congrats!
Side note: while Luna is bonded, it is staked and generates rewards for the delegator and validator. During that time, Luna can’t be freely traded; for that, it needs to be unbonded. The unbonding phase takes 21 days to complete, after which the Luna returns to an unbonded state.
DISCLAIMER: This is not financial advice. Staking and cryptocurrencies investment involves a high degree of risk, and there is always the possibility of loss, including the loss of all staked digital assets. Additionally, delegators are at risk of slashing in case of security or liveness faults on BPoS protocols. We advise you to DYOR before choosing a validator.