How to Stake TON on Compound: Ultimate Step-by-Step Guide (2023)

Unlock Earnings: Staking TON on Compound Made Simple

Staking TON on Compound lets you earn passive income while participating in decentralized finance (DeFi). This comprehensive guide breaks down how to stake The Open Network’s native token on Compound Finance—one of Ethereum’s leading lending protocols. Whether you’re new to DeFi or an experienced user, you’ll learn the exact steps to maximize yields while understanding key risks. By the end, you’ll be equipped to put your idle TON to work efficiently.

What is TON (The Open Network)?

TON is the native cryptocurrency of The Open Network—a high-speed, scalable blockchain originally developed by Telegram. Designed for mass adoption, TON handles millions of transactions per second with minimal fees. Key features include:

• Ultra-fast transactions (up to 100,000 TPS)
• Environmentally friendly proof-of-stake consensus
• Integrated support for dApps, NFTs, and DeFi services
• User-friendly wallets like Tonkeeper and Tonhub

Understanding Compound Finance

Compound is a decentralized lending protocol on Ethereum where users earn interest by supplying crypto assets to liquidity pools. Borrowers pay interest to access these funds, creating yield opportunities. Unique features include:

• Algorithmic interest rates based on supply/demand
• Automatic compounding of rewards
• Governance by COMP token holders
• Non-custodial design (you control your keys)

Why Stake TON on Compound?

Staking TON via Compound offers distinct advantages over traditional holding:

• Passive Income: Earn daily APY (Annual Percentage Yield) without active trading
• Liquidity Access: Use supplied TON as collateral for loans
• DeFi Integration: Participate in broader Ethereum ecosystem strategies
• Compounding Effect: Reinvested earnings accelerate growth over time

Step-by-Step: How to Stake TON on Compound

Note: TON must be bridged to Ethereum as ERC-20 wrapped TON (wTON) first.

1. Bridge TON to Ethereum:
   • Use a cross-chain bridge (e.g., Multichain, Celer)
   • Send TON from your native wallet to receive wTON on Ethereum
2. Connect Wallet:
   • Visit app.compound.finance
   • Link a Web3 wallet (MetaMask, WalletConnect)
3. Supply wTON:
   • Select wTON from the “Supply” market list
   • Enter amount and confirm transaction (gas fee required)
4. Monitor & Manage:
   • Track accrued interest in your dashboard
   • Withdraw anytime or use as loan collateral

Key Risks and Mitigation Strategies

While lucrative, staking carries inherent risks:

• Smart Contract Vulnerabilities: Use audited protocols only
• Impermanent Loss: Less relevant for lending but monitor wTON/TON peg stability
• Bridge Risks: Choose reputable bridges with multi-sig security
• Gas Fees: Time transactions during low Ethereum congestion

Always stake only what you can afford to lose and diversify across platforms.

TON Staking on Compound: FAQ

Can I stake native TON directly on Compound?

No. You must first bridge TON to Ethereum as wTON (wrapped TON) since Compound operates on Ethereum. Native TON staking occurs on TON blockchain validators.

What’s the average APY for staking wTON on Compound?

APY fluctuates based on market demand. Historically, it ranges between 2-8%. Check Compound’s dashboard for real-time rates before staking.

Are there minimum staking amounts?

Compound has no minimum, but Ethereum gas fees make small deposits impractical. We recommend staking at least $200 worth of wTON to offset costs.

How often is interest compounded?

Interest compounds every Ethereum block (~15 seconds). Earnings accrue continuously and can be withdrawn anytime.

Is unstaking instantaneous?

Yes. Withdrawals process in one transaction, but bridge transfers back to native TON may take 5-20 minutes depending on the service.

Can I borrow against staked wTON?

Absolutely! Supplied wTON acts as collateral. Borrow up to 50-75% of its value in stablecoins or other supported assets.

Final Tips for Success

Maximize your TON staking strategy with these pro tips: Use price alerts to track wTON/TON parity, reinvest earnings monthly to harness compounding, and monitor Compound governance for protocol updates. As DeFi evolves, bridging solutions will improve—making cross-chain staking increasingly efficient. Start small, stay informed, and watch your crypto portfolio grow.