If we stake on any node, rewards will be same

or differ with nodes ?

It should be the same for each of the council nodes. You just want to try and pick a council node that has excellent uptime. I have my HBARs in multiple wallets so will probably delegate each wallet to a different node.

So this is where I get confused. I thought your hbar is attached to an account #, not the wallet which just stores the keys. I don’t understand why if the Ledger is used to pass the keys to the wallet, why it would not work out of the box? The staking protocol only needs to know how many hbars are in your account and the node you want to point it to.

Okay, to clarify my earlier statement about having multiple wallets, I have a separate Account ID associated with each wallet. But I think you are correct, it is the Account ID that will be associated with a staking node👍

Ok, got it. For me, I am going to wait for Ledger integration to Hashpack before I native stake. Thanks.

That sounds like a safe move. I can’t imagine that native staking is going to give much of a return in the short term anyway. It appears as though wallet providers are expecting to be ready for native staking by the end of July (so maybe early August to go live), but there is simply not enough fees being generated on the network right now for any expectation of a reasonable staking reward. Sure, the HBAR Foundation could try and goose the returns by donating to account 0.0.800 but it seems like they’ve already backed themselves into a corner by supporting liquid staking on Stader Labs. If the staking rewards from Stader drop to near zero, then the TVL on that platform will likely drop significantly. Why would anyone take the risk of having their HBAR locked in a smart contract plus having a 7 day lock up period if they weren’t getting a decent staking reward? The next week or two will be very interesting. The only thing that enables this to all make sense from a financial standpoint is if the “step function” for network activity finally happens.

It would likely be added to by hedera themselves as opposed to the foundation as this is native staking

A few things…in the doc from Hedera it says the maximum return will be 6.5% in these early stages. Mance and Leemon have both said rewards do not have to be only sourced from fees. And Elaine from the HBF has already indicated they are willing to donate to 0.0.800. Also, you make a good point about Stader and Stader would have had to have had the discussion with Hedera/and the HBF before this all started. They’ve put in a LOT of effort to earn 10% of “de minimis”. I think native rewards will be juiced to at least 5% and Stader will come down to that level. One final point on Stader - they have said from the beginning that the 7 day number was just a holding place until native protocol was decided. They have said they would match whatever the cool down period is for native.

Interesting. With all that being said, I know Stader has (tax) benefits now. But in TIME, will you stay with Stader or go native staking? Or too early to tell?

Sorry, but I don’t see where the economic benefit comes from for either Hedera or the Foundation from throwing extra HBAR into account 0.0.800 to try and goose the staking returns. Anyone that is paying attention is going to participate in native staking anyway as it is basically like receiving interest on your checking account. You don’t have to do anything for the rewards, so why should anyone care what they are? If Hedera uses it’s treasury to donate to account 0.0.800 then they are simply giving away free HBAR and depleting their remaining nest egg available for future funding and development of the network. This creates a negative risk/reward scenario that we don’t really need right now. The same goes for the HBAR Foundation. They have a limited amount of HBAR to continue to give away. Now that they’ve made the commitment to support liquid staking on Stader Labs, it would be strange for them to suddenly abandon Stader and throw extra HBAR into native staking. Stader staking rewards need to outperform native staking in order to remain competitive. However, they are not at the point where they can do that yet without getting subsidized by the Foundation.

Incentivising network participants from the treasury before fees are able to cover it is what every network does

I don’t have a problem with that, but that is different from using treasury funds to artificially boost staking returns on the network.

Stader has inherent benefits over native just as native has some of Stader. They will both have about the same return and it will be up to holders to decide which benefits they want to take advantage of.

Every single proof of stake network pays their staking rewards this way currently

At least the majority of them

The HBF does not have to abandon Stader. They can simply shift their support to native and Stader will reap those rewards through native staking their holdings.

Understood. I just don’t see how Stader will outperform native staking in the short run without additional support from the Foundation. I see additional risks with Stader staking as opposed to native staking, but the additional rewards have to come from somewhere. It’s not clear to me where those extra rewards will come for the next few months until DeFi picks up.

But as we all know, this way of paying staking rewards is unsustainable and is merely a marketing gimmick that adds an additional risk element to the future finances of any project. The Hedera team were always the adults in the room in the “crypto” world. I’m not sure doing something simply because “everyone else is doing it” is the right way to go here. Just my opinion, of course and not trying to argue👍

Stader charges a 10% fee on the rewards before they hit the pool. The IRS is going to charge me a 24% tax on native rewards. They both (native and Stader) will have the exact return - whatever Hedera determines that to be - so Stader will beat native by 14% for US folks in my bracket.

Everyone else is doing it because decentralised networks rely on providing incentives in exchange for people to participate and help to keep the given network secure, it’s not sustainable but the idea is generally that you gain enough adoption that fees can then cover the incentives instead before you run out of the supply that’s been allocated to this.

So you are intending to hold HBARX for more than a year to get taxed at the capital gains tax rate? It’s still really a tax deferment though isn’t it? Maybe at some point you could put your HBARX into a self directed IRA?🤔

It hasn’t really been an issue since hedera has been pemissioned with no staking so far but once you start to bring things like community nodes out and the ability to stake you nodes you need an incentive in exchange for people doing these things.

I am. But the tax for capital gains are the same whether you hold HBAR or HBARX. Only the tax on rewards is different - none with HBARX and native staking as regular income.

Sure. My point is that I would rather see treasury funds allocated directly to incentivize building on the network, similar to the original idea behind the HBAR Foundation, rather than just airdropped into goosing staking returns. I think you get a better return on investment by helping people build on the network - at the end of the day, it’s all about how you spend your war chest to increase sustainable TPS on the network.

I’m staying with Stader unless something better comes along.

I agree with you. I really hope they know there are BIG tx numbers coming now. Like days or weeks at the most. But I’m happy to take advantage of the free HBAR if they’re going to hand them out. 🤷🏻‍♂️

It wouldn’t take all that much of the unallocated supply to maintain a couple percent for a few years

😁😁 In my mind I keep thinking that the big bump in TPS HAS to be right around the corner, and then the timing of everything makes sense. Let’s just hope so🤞🤞

I could see a 2% return being feasible as a “supplement” to native staking rewards until actual network fees pick up. It would be a competitive return with the 3 month T-bill rate, so people that live in the “real world” could see the benefits of it. Plus, this would be sustainable for a while. I think the unsustainable APR’s offered by many in the “crypto world” will soon be a thing of the past as everyone starts to appreciate the risks associated with the sky high returns that have been offered in this space in the past.

Such a large percentage of the total network stake has been held back in treasury, they could easily commit to a pretty high staking return and let it fade downward as transaction fees take over in place of the subsidy and only spend a fraction of the treasury. For example, they could start at 4.6% and allow that to drift to zero over 2 full years and only spend a billion ħ on it, which is like 1/20th of the treasury.