# How Rewards Work

PrimeStaking's XDC Liquid Staking system offers transparent, on-chain reward distribution. By leveraging psXDC and optional XDC NFTs, you can choose the staking strategy that fits your goals.

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## Current APY Tiers

| Staking Option             | APY      | Description                                                 |
| -------------------------- | -------- | ----------------------------------------------------------- |
| **XDC Liquid Staking**     | \~4.5%   | Stake XDC, hold psXDC, earn rewards. Simple.                |
| **XDC NFTs (Unlocked)**    | \~4.75%  | Deposit psXDC inside an XDC NFT for a bonus multiplier.     |
| **XDC NFTs (1-Year Lock)** | Up to 6% | Lock your NFT for 1 year for an additional 1.25% APY bonus. |

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## How APY Breaks Down

| Component           | Rate   | Requirement                                                  |
| ------------------- | ------ | ------------------------------------------------------------ |
| Base liquid staking | 4.5%   | Hold psXDC                                                   |
| NFT staking bonus   | +0.25% | Deposit psXDC into an XDC NFT                                |
| NFT lock bonus      | +1.25% | Lock the NFT for 1 year (disables burn, merge, and withdraw) |
| **Maximum total**   | **6%** | NFT staked + locked                                          |

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## How Rewards Are Calculated

* **Proportional distribution** - Rewards are allocated based on how much psXDC you hold (or have staked inside an NFT) relative to the total supply.
* **On-chain and transparent** - Every reward event is logged on the blockchain.
* **Claim anytime** - Rewards accrue continuously. Go to the **Rewards** tab in the app and claim to your wallet whenever you want.

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## Why Multiple Tiers?

| Goal                                            | Best Option                 |
| ----------------------------------------------- | --------------------------- |
| Keep it simple, stay fully liquid               | XDC Liquid Staking (\~4.5%) |
| Earn more while engaging with the NFT ecosystem | XDC NFTs Unlocked (\~4.75%) |
| Maximize yield, 1-year commitment               | XDC NFTs Locked (up to 6%)  |

Each tier builds on the previous one. Start with liquid staking and move into NFTs when you're ready - there is no pressure to lock.

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## Understanding Reward Timing

| Product                | How Rewards Accrue                                | How You Claim                | Reward Token |
| ---------------------- | ------------------------------------------------- | ---------------------------- | ------------ |
| **XDC Liquid Staking** | Continuously, as validators produce blocks        | Anytime from the Rewards tab | psXDC        |
| **XDC NFTs**           | Calculated monthly based on your NFT's multiplier | Monthly, from the app        | XDC          |

Liquid staking rewards accrue in real time and can be claimed whenever you want. NFT rewards follow a monthly distribution cycle based on each NFT's total multiplier relative to all staked NFTs.