Staking involves locking up cryptocurrency to support the operations of a proof-of-stake blockchain network. In return, stakers earn rewards, similar to earning interest.
How staking works: Lock tokens in staking contract, help validate transactions and secure network, earn rewards proportional to stake, and may have unbonding/unstaking period.
Staking options: Native staking directly with validators, liquid staking (Lido, Rocket Pool) receiving derivative tokens, exchange staking through CEXs, and DeFi protocol staking.
Risks of staking: Slashing penalties for validator misbehavior, lock-up periods, opportunity cost, smart contract risk (liquid staking), and validator selection risk.