Solana Staking Rewards

Solana staking rewards are calculated by adding together your share of a validator’s issuance rewards, MEV rewards, and in some cases, block rewards, minus any validator commission fees. Rewards are based on Solana’s inflation rate, staking ratio (~65%), the total amount of SOL staked to your validator of choice, your share of the staked SOL, and the validator's performance. Solana’s total issuance rewards are distributed proportionally among all stakers that are actively staked. Lastly, the more stake a validator has, the more blocks it has the opportunity to produce and the more MEV tips it may earn. If you receive a portion of your validator’s block rewards, the better your validator is at packing blocks with transactions, the higher the rewards will be.

Validators charge a fee, or commission, on the staking rewards they earn. This percentage is deducted from your gross rewards before they are paid out to you, directly impacting your net APY. Validators that charge fees typically charge them on inflation rewards and MEV rewards. Validators that charge 0% commission like Helius pass all inflation and MEV rewards back to the stakers.

Choosing a Solana validator to stake SOL with involves considering a few criteria including the validator’s commission fees, staking APY, validator uptime, skip rate, sandwich rate, compute units, and reputation. If you’re an institution, additional considerations include SOC II compliance, security, integrations with qualified custodians, customer support, and monthly reporting.

Entities that run their own Solana validator can earn more SOL staking rewards by keeping the block rewards, or the base fees and priority fees, which are not typically shared with native stakers and liquid stakers because there is no in-protocol method for distributing block rewards to stakers. This can add an additional 0.5-1.5% APY to your Solana staking returns.