Staking is the act of depositing an asset and “locking” it as collateral in a protocol. By locking it, one can provide a service needed for the long term sustainability of the protocol
- Staked assets have value accrual mechanisms and give their holders a claim on the value generated by the pool (usually in the form of trading fees generated or tokens)
- Yield farming focuses on gaining the highest yield possible and constantly moving around funds while staking focuses on helping a blockchain network stay secure while earning rewards