Staking is the process of locking up your tokens to support network operations such as transaction validation and block production. In Ethereum’s case, staking is crucial to secure the network and enable its Proof-of-Stake (PoS) consensus mechanism.
Your staked ETH earns rewards, creating a passive income stream. We consider it as the lowest-risk crypto investment on Ethereum because if staking fails, it implies a significant issue with the entire Ethereum ecosystem.
If we were to draw parallels with traditional finance, staking ETH is akin to investing in the 30-year U.S. Treasury Bill.