NFT Staking

Definition ∞ NFT Staking involves locking up non-fungible tokens in a smart contract to earn rewards, typically in the form of cryptocurrency tokens or other NFTs. This mechanism allows NFT holders to generate passive income from their digital collectibles without selling them. The rewards often depend on the rarity, utility, or specific collection of the staked NFT. It represents an evolution in how value is derived and secured within the NFT ecosystem.
Context ∞ NFT staking is a growing trend frequently reported in news concerning the expansion of non-fungible token utility and decentralized finance integration. Discussions often focus on the economic sustainability of staking rewards and the true value proposition for NFT holders. Future developments aim to integrate NFT staking more deeply into gaming, metaverse, and art platforms, providing more diverse earning opportunities. This mechanism is key to increasing the functional value of digital collectibles beyond mere speculation.