Each block minted is rewarded with varying amount of ADA. Every 5 days — this period is called “epoch” — those rewards are calculated and distributed amongst delegators according to their stake. Thus, rewards are only paid if the pool has minted blocks.

At the time of writing this guide, a pool needs to have around 1 million ADA staked to have a 100% probability to mint 1 block per epoch. Probability, however, does not guarantee the event: it could be 0 blocks, it could be 10. This random selection is handled by the Cardano staking protocol – Ouroboros.

Nevertheless, this probability allows for the staking rewards to average out over a sustained period of time, which means that a functioning stake pool should provide delegators with around 4-6% of yearly return. Rewards also compound over time, try out the calculator tool we’d made.