What is a Ledger?
To fully understand what a Ledger is, we first need to understand the mechanics of a crypto wallet.
A crypto wallet is a software or physical device allowing you to receive, send and use your crypto. Wallets now provide features such as staking, swapping, and access to other dApps and DeFi services. To get access and manage your funds, each wallet has a public and private key that you will need to use:
The public key is used to send crypto to your wallet
The Private key(s) is used to withdraw and use your crypto (for example staking). This key should never be shared with anyone else!
There are three common ways that people store their crypto, either in a custudial or non-custodial fashion.
On an Exchange such as Binance, Coinbase, or Bitfinex. The benefit of storing your crypto here is that you have easy access to their platform with multiple different financial services such as spot and margin trading in highly liquid pools. However, these exchanges hold your crypto in their own wallets, having full access to the private keys. This poses a security threat if they ever get hacked. Most importantly, storing crypto on an exchange goes against decentralisation efforts that many crypto networks stand for.
Software wallets (hot wallets). In these wallets, your crypto is fully under your ownership. They are built for convenience, allowing quick access to your crypto and DeFi. The downfall is that they are connected to the internet, so there is always the possibility that a hacker may find ways to seize information to access your funds.
Hardware wallets (cold wallet). Like software wallets, these wallets allow you to have full control of your crypto, but are built with the main focus being security. Unlike software wallets, private keys are stored offline, making it very difficult to hack. This is the most secure way of storing and using your crypto. These wallets are becoming more user friendly, allowing to store multiple different cryptos, direct access to DeFi services, as well as the ability to connect to many software wallets giving access to their services.
A ledger is a hardware wallet, and provides a highly secure way of holding and managing your crypto. The ledger live application must be used along with your ledger device providing multiple products and services, making it easy to use and manage your crypto.
Pros and Cons of each wallet type
So how do you stake using a ledger wallet?
The answer to this question depends on which token you are staking. The ledger live app provides the ability to download an application for many different crypto networks. For example, there is a Ethereum, Polkadot, Cosmos, Cardano... etc application available to download. Each application provides different functionalities, some providing the option to stake using ledger live.
Staking with ledger live application
Ledger live has created applications for specific networks to allow you to stake straight from it. Essentially, here are the steps to stake your crypto straight from the app:
1. Download the crypto application.
2. Open an account for the crypto.
3. Transfer funds to your crypto wallet
4. Use the crypto application to stake.
We have created guides here to help you get started:
Polkadot (DOT) Ledger Live Staking Guide
Staking with ledger without ledger live staking integration
Ledger live is continuously growing, however it does not allow you to stake straight from the application for many cryptocurrencies yet. Fortunately in most cases you can connect your hardware device to software wallets that provide staking services. You funds are still held in your hardwallet with high level of security, but you connect to software wallets to use its staking services. We have created guides to help you get started:
Daedalus + Ledger Cardano (ADA) Staking Guide
For more information on staking with P2P Validator, visit https://p2p.org/.
For additional introduction to staking support, visit the getting started support center.
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