In March 2026, BlackRock, the world's largest asset manager, launched a fund that holds Ether, the coin that powers the Ethereum network, and earns income by staking part of it.
A Benzinga report on the fund's filing showed that the fund's sponsor and trading partner would keep a combined 18% of the staking rewards, which is why the advertised rate is rarely the rate you keep.
Staking is now offered inside funds and crypto apps, so anyone who holds crypto will eventually be asked whether to switch it on.
What Does Staking Crypto Mean?
Staking crypto means locking up coins you own so a blockchain can use them as a security deposit, and in return the network pays you rewards in more coins.
A blockchain is a shared digital record of transactions that thousands of computers keep in sync, with no single bank or company in charge.
Staking works only on blockchains built on proof of stake, a design where people who put up coins as a deposit get to help approve new transactions.
Ethereum and Solana both use it, while Bitcoin relies on mining, where computers race to solve puzzles, so you cannot stake it directly.
For you, the appeal is simple: coins you plan to hold anyway can earn a return instead of sitting idle.
The catch is that rewards are paid in the same coin whose price can swing, so staking changes how much you hold, not how risky the coin is.
How Does Staking Work?
The computers that approve transactions on a proof-of-stake blockchain are called validators, and each one must lock up coins before it can take part.
A validator that does its job honestly earns rewards.
One that cheats can lose part of its locked coins on networks like Ethereum, a penalty called slashing.
Most people do not run a validator themselves, so they hand their coins to one that does, which is called delegating.
Say you stake 10 coins worth $100 each, or $1,000 total, at a reward rate of 5% a year.
After a year you have earned about 0.5 coins, so you hold 10.5.
If the coin's price fell 20% to $80 over that year, your 10.5 coins are worth $840, which is less than the $1,000 you started with.
The rewards softened the drop, but they did not prevent it.
What Are the Ways to Stake Crypto?
Running Your Own Validator
On Ethereum, running your own validator takes 32 Ether and a computer that stays online around the clock, according to Ethereum's own staking guide. That amount has been worth tens of thousands of dollars at recent prices, so this route suits a small group of people.
Staking Through a Platform
A crypto platform can stake coins for you by pooling them with other customers' coins and running the validators itself. You can usually start with any amount, and the platform takes a fee out of your rewards.
Staking Through a Fund
A fund pools many investors' money to buy assets, and several U.S. funds have staked part of their holdings since late 2025, letting you earn staking rewards from an ordinary brokerage account, the kind of investing account used to buy stocks. Benzinga reported in June 2026 that Solana's staking reward of nearly 6% could become a major selling point for funds tied to that coin.
Is Staking the Same as Earning Interest?
No, and this is the most common thing beginners get wrong.
A bank pays interest in dollars at a rate it sets, and the Federal Deposit Insurance Corporation, or FDIC, the federal agency that insures bank deposits, covers up to $250,000 per depositor if the bank fails.
Staking pays in the coin itself at a rate the network sets and changes, and the FDIC says crypto assets are not covered by deposit insurance.
Think of staking as an extra payout on an investment whose price can still fall, not as a savings rate.
What Are the Risks of Staking?
Price Swings
Rewards are paid in the coin you staked, so a falling price can erase them, as the 20% drop in the earlier example showed.
Lockup Periods
Unstaking is not instant, because the network makes you wait before your coins are released, and that wait can stretch from a few days to longer when many people leave at once. During the wait you cannot sell, even if the price is dropping.
Slashing and Platform Failure
On networks that use slashing, such as Ethereum, misbehavior by a validator can destroy part of the stake, and some platforms say they reimburse it, so read the terms before you commit. If the platform holding your coins fails, federal deposit insurance does not apply.
Fees
Platforms and funds take a cut of your rewards, which lowers what you actually earn. If Ether staking pays roughly 3% a year, as the breakdown of BlackRock's filing assumed, an 18% cut leaves you about 2.5%.
How Are Staking Rewards Taxed?
In the United States, the IRS treats staking rewards as income, valued at their market price on the day you gain control of them, meaning the day you can sell or transfer them, according to Revenue Ruling 2023-14.
The same rule applies whether you stake on your own or through a platform.
If you receive 0.5 coins when each is worth $100, you report $50 of income that year, even if you never sell.
That $50 also becomes your cost basis, the starting value used to figure your gain or loss when you later sell.
Lawmakers have pushed the IRS to revisit this rule, so confirm the current treatment with a tax preparer before you file.
How Do You Start Staking?
Before you confirm any stake, check the reward rate, the fee taken out of it, and how long unstaking takes.
Starting with a small amount lets you see how rewards arrive and how the unlock wait works before you commit more.
If you want to try it, Gemini lets you buy crypto and stake supported coins like Ether and Solana from one account, with its service fee deducted automatically from the rewards you earn.
Staking availability varies by location, so confirm which coins you can stake before you fund an account.
Rewards move with network conditions, so the rate you see on the day you stake is a snapshot, not a promise.
