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Is my ada safe when staking?

This is a common question from people who are new to Cardano, who are familiar with staking on other blockchains, or who are moving their funds from an exchange to a self-custodial wallet such as Daedalus, Eternl, Flint, Typhon, Yoroi, and others.

As Cardano is a proof of stake (PoS) blockchain, it relies on holders delegating their ada to stake pools to secure the blockchain. In return they delegators are rewarded with ada. As Cardano relies on delegators taking part in this process it has been designed to be very secure.

  • When a delegator stakes their ada on Cardano their funds do not leave their wallet, the staking mechanism therefore does not put the delegator's ada at risk.

  • Staking is liquid, which means ada is not locked up for any period, delegators can move or spend their ada whenever they like.

  • The worst thing that could happen is that a stake pool underperforms, in which case a delegator may not receive all of the staking rewards. Even if this happens, the ada in the delegator's wallet is not at risk of being slashed or penalized in any way.

  • In line with the ethos of cryptocurrency and blockchain technology, staking is completely trustless and staking rewards are distributed automatically by the protocol.

  • A delegator can move to a new stake pool whenever they wish.

  • You can stake while using a hardware wallet and it is advisable to use one for extra security. See 'Should I get a hardware wallet?'