# Understanding Delegated Staking

Since **delegated staking** is a financial decision, the configurator will **not** automatically commit your node to become available for delegated staking. 

* [ ] This action must be **manually** initiated by the Node Operator.
* [ ] To validate your permission to update delegated staking settings on the **metagraph**, you will be prompted to enter your p12 passphrase.

{% hint style="danger" %}
Delegated staking is **permanent** and **cannot be disabled** once it has been enabled.

There are **no** downsides to enabling delegated staking it simply allows you to earn additional rewards without impacting your existing node operations.
{% endhint %}

## High Level Flow

This is the logical flow of how delegation works on your node.

{% stepper %}
{% step %}

### Create a Configuration

You will log into your node and go through the necessary steps to build a configuration file that lives locally on your node.
{% endstep %}

{% step %}

### Update

You will instruct **nodectl** to:

* Pull your local configuration.
* Formulate a signed authorization request to delegate.
* Push (`POST`) signed request to the metagraph.
* Review the results of your delegation request.
  {% endstep %}

{% step %}

### Future Updates

* Update your local configuration to your new setting requirements.
* Repeat Step 2.
  {% endstep %}
  {% endstepper %}

## How Commission Works

**✅ Key Point: Collateral Requirement**

To operate a node, you are required to allocate **250,000 $DAG** as collateral.\
You will earn **100% of the rewards** generated by your own collateral—**these rewards are exclusively yours** and are not shared.

**👥 Delegators and Additional $DAG**

When other community members choose to **delegate their $DAG** to your node, the total amount delegated is **added to your node's effective stake**, increasing your node's influence and overall earning potential. 

:moneybag: **Example: Understanding Rewards from Delegation**

Let’s say delegators collectively point **X $DAG** at your node.

* Your node will now earn additional rewards based on this **delegated stake**.
* You will receive a **commission** (a percentage you set between 5–10%) from the rewards generated by the **delegated X $DAG**.
* The remaining rewards go back to the **delegators**, proportional to their contribution.

**In Our Example**

* Let's say: **800 $DAG** was earned in total from **X $DAG** delegated to your node for you and your delegators.  *This does not include rewards earned from your original 250,000 $DAG staked as collateral on your node.*
* You set a **10%** commission charge.

<table><thead><tr><th>Earning Type</th><th width="145.25457763671875">Daily Earned</th><th width="142.98187255859375">Commission Set</th><th width="113.5999755859375">Your Earnings</th><th>Delegator Earnings</th></tr></thead><tbody><tr><td>Delegated Staking</td><td>800 $DAG</td><td>10%</td><td>80 $DAG</td><td>720 $DAG</td></tr><tr><td>Your Node's Collateral</td><td>600 $DAG </td><td>0%</td><td>600 $DAG</td><td>0 $DAG</td></tr><tr><td><strong>Total</strong></td><td><strong>1,400 $DAG</strong></td><td></td><td><strong>680 $DAG</strong></td><td><strong>720 $DAG</strong></td></tr></tbody></table>


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