How to Stake Ethereum on Compound: Step-by-Step Guide for Beginners

## Introduction
Staking Ethereum on Compound Finance lets you earn passive income by contributing to the network’s security while putting your idle ETH to work. As a leading decentralized finance (DeFi) protocol, Compound allows users to lend crypto assets like Ethereum and earn interest rewards in COMP tokens. This step-by-step guide simplifies how to stake Ethereum on Compound, covering wallet setup, transaction execution, and reward management. Whether you’re new to DeFi or an experienced user, you’ll learn to navigate the process safely and efficiently.

## Step-by-Step Guide to Staking Ethereum on Compound
Follow these six key steps to stake your ETH on Compound:

### Step 1: Set Up a Web3 Wallet
– **Choose a compatible wallet**: Install MetaMask (browser extension/mobile app) or Trust Wallet.
– **Secure your wallet**: Write down the 12-word recovery phrase offline and enable two-factor authentication.
– **Add Ethereum network**: Ensure your wallet is connected to the Ethereum Mainnet.

### Step 2: Acquire Ethereum (ETH) and Gas Fees
– **Buy ETH**: Purchase Ethereum from exchanges like Coinbase or Binance.
– **Transfer to wallet**: Send ETH to your Web3 wallet address.
– **Budget for gas**: Reserve 0.05–0.1 ETH for transaction fees (gas costs vary with network congestion).

### Step 3: Connect Wallet to Compound
– Visit the official [Compound Finance app](https://app.compound.finance/).
– Click “Connect Wallet” and select your wallet provider (e.g., MetaMask).
– Authorize the connection in your wallet pop-up.

### Step 4: Navigate to Ethereum Staking
– On Compound’s dashboard, locate “Supply Markets.”
– Find Ethereum (ETH) in the list and click “Supply.”
– **Note**: Compound uses cTokens (cETH) to represent staked assets.

### Step 5: Stake Your Ethereum
– Enter the ETH amount you wish to stake (minimum 0.001 ETH).
– Review transaction details: Interest rate, cETH conversion rate, and gas fee.
– Confirm the transaction in your wallet. Wait 1–5 minutes for blockchain confirmation.

### Step 6: Manage and Track Rewards
– View accrued COMP tokens in Compound’s “COMP” tab.
– **Claim rewards**: Click “Claim COMP” and pay gas fees to transfer tokens to your wallet.
– Monitor performance: Track APY fluctuations and cETH balance on the dashboard.

## Maximizing Your Staking Experience
– **Reinvest rewards**: Compound returns by staking earned COMP tokens.
– **Use Ledger/Trezor**: Enhance security with hardware wallet integration.
– **Monitor gas fees**: Schedule transactions during low-activity periods (check [Etherscan Gas Tracker](https://etherscan.io/gastracker)).

## Frequently Asked Questions (FAQ)

### What is the minimum ETH to stake on Compound?
You can stake as little as 0.001 ETH, but ensure you have sufficient ETH left for gas fees (typically 0.01–0.05 ETH per transaction).

### How often are rewards distributed?
COMP rewards accrue continuously and can be claimed manually anytime. Interest on staked ETH compounds every Ethereum block (~12 seconds).

### Can I unstake my ETH immediately?
Yes! Click “Withdraw” in the ETH supply market. You’ll receive your original ETH plus accrued interest minus gas fees within minutes.

### Is staking ETH on Compound safe?
Compound is audited and battle-tested, but risks include smart contract vulnerabilities, ETH price volatility, and gas fee fluctuations. Never share your private keys.

### What’s the difference between staking and lending on Compound?
“Staking” on Compound refers to supplying ETH to earn interest (technically lending). Unlike traditional proof-of-stake, you retain full custody and liquidity.

### Do I pay taxes on staking rewards?
Yes, most jurisdictions treat staking rewards as taxable income. Consult a tax professional for compliance.

## Conclusion
Staking Ethereum on Compound unlocks a straightforward path to earning passive income in DeFi. By following this guide—securing a wallet, managing gas fees, and understanding reward mechanics—you transform idle ETH into productive assets. Start small, stay informed about network updates, and compound your crypto growth today. Always prioritize security: double-check URLs, use bookmarks for Compound’s official site, and never rush transactions.