Can someone explain in layman terms how yield is produced when staking on coinbase?

Are they gambling with my Solana?

Is my solana at risk?

Where does the extra Solana come from that they are paying me every few days?

  • Majestic_Fox_428BEnglish
    1·
    1 year ago

    I am also clueless about this as well. Where do the rewards come from? Out of thin air it seems? How do they pay so much?

  • detenBEnglish
    1·
    1 year ago

    Solana has a reward structure, lets say every year you make 10% on a crypto. Coinbase will keep 5% and give you 5% when you stake on their platform. If you stake outside of their platform, you might be able to get more or less of that 5% depending on what validator you stake on. The above numbers are just made up, I believe my staking account is getting about 7.3%