Ethereum (ETH) is the second-largest cryptocurrency by market capitalization and one of the most widely used blockchain networks in the world. Other than being just a crypto asset you can buy and hold, Ethereum also offers something called staking*, a way for investors to earn rewards on ETH they already own.
If you’ve ever earned dividends from stocks or interest from bonds, staking works in a similar way.
What Does It Mean to Stake ETH?
In technical terms, staking is the process of committing your ETH to help secure the Ethereum blockchain. When you stake ETH, you’re essentially supporting the network by validating transactions and keeping everything running smoothly. In return, the network rewards you with more ETH.
Confusing, right? Let’s make it simple.
Here’s a way to think about it:
- Stocks → can pay dividends.
- Bonds → can pay interest.
- Ethereum → can pay staking rewards (in the native cryptocurrency ETH).
So instead of a company paying you dividends or a bank paying you interest, Ethereum itself pays you rewards for helping keep the network healthy.
Staker vs. Delegator
There are two main ways people can participate in ETH staking:
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Staker (Validator): Runs their own validator node, which requires 32 ETH, technical knowledge, and reliable hardware. Validators are directly responsible for confirming transactions and maintaining the blockchain, and they earn rewards for doing the heavy lifting of keeping Ethereum secure.
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Delegator: Most everyday investors fall into this category. Instead of running a validator, they delegate their ETH to a platform (like iTrustCapital, Coinbase, Kraken, Lido, or Rocket Pool). The platform operates the validator on their behalf, and delegators receive a share of the rewards without having to manage the technical side.
Let's look at it like this. Think of it like farming:
- A staker (validator) is the farmer; they own the land, plant the crops, and do all the work.
- A delegator is someone who provides seeds or resources to the farmer, then shares in the harvest without doing the hard labor.
Why Do People Stake ETH?
There are several reasons investors choose to stake their ETH, and it often comes down to a mix of rewards, simplicity, and long-term strategy.
Earn Rewards
The biggest draw is the opportunity to earn more ETH. When you stake, the network compensates you with rewards for helping validate transactions and keeping Ethereum secure. It’s a bit like receiving dividends from stocks or interest from bonds, only here, the blockchain itself is paying you.
No Mining Needed
Bitcoin relies on mining, which requires expensive hardware and a substantial amount of energy. Ethereum staking is different. You don’t need a massive setup or specialized equipment—just ETH and access to a platform that supports staking. That makes it more accessible to everyday investors.
Long-Term
When ETH is staked, it isn’t just sitting idle. It’s actively earning rewards while you continue to hold it. For long-term investors, this can be valuable since rewards build on top of your existing ETH, creating a compounding effect over time.
How Can I Stake ETH?
If you want to stake ETH, there are several ways to do it. Some are simple, while others require a lot of technical know-how:
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Retirement Accounts & Secure Custody: With platforms like iTrustCapital, you can stake ETH directly inside a self-directed Crypto IRA or in a secure Premium Custody Account (PCA). Staking in a Crypto IRA lets you earn staking rewards while also benefiting from the tax advantages of a retirement account: tax-deferred** in a Traditional IRA or potentially tax-free in a Roth IRA. With PCA, ETH can be staked securely.
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Exchanges & Pools: Many crypto exchanges allow ETH staking with just a few clicks. It’s convenient, but your ETH is in the exchange’s custody, so you’re relying on their security.
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Personal Wallets: Some wallets support staking, but they may still require more technical setup and maintenance than most investors want.
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Running Your Own Validator: The most advanced method requires at least 32 ETH, specialized hardware, and technical expertise to operate a validator node around the clock. It gives you full control but isn’t realistic for most everyday investors.
Stake ETH in a Tax-Advantaged Crypto IRA & Secure PCA Today
Ethereum staking is a powerful way to put your ETH to work. Whether you see it as similar to earning dividends or interest, staking gives long-term holders the chance to earn rewards on their crypto.
But where and how you stake matters. Running your own validator may not be realistic, and exchanges plus personal wallets come with trade-offs in custody and security. That’s why many investors choose to stake ETH at iTrustCapital through secure crypto accounts and retirement accounts.
At iTrustCapital, you can:
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Stake ETH inside a Crypto IRA – giving you the potential to earn staking rewards in a tax-advantaged account (tax-deferred in a Traditional IRA or potentially tax-free in a Roth IRA).
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Use a Premium Custody Account (PCA) – for institutional-grade storage and simplified staking.
Get started with ETH staking at iTrustCapital today!
*Staking involves considerable risks. See Staking Risks for more information.
**Some taxes may apply.
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Disclaimer
This article is for informational purposes only and is not intended to constitute investment advice in any way or constitute an offer to buy or sell any digital asset, cryptocurrency, or security or to participate in any investment strategy.
iTrustCapital is a fintech software platform for alternative assets. TrustCapital is not an exchange, funding portal, custodian, trust company, licensed broker, dealer, broker-dealer, investment advisor, investment manager, or adviser in the United States or elsewhere. iTrustCapital is not affiliated with and does not endorse any particular digital asset, precious metal or investment strategy.
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