Can You Stake Stocks? A Guide

Can you stake stocks? In the strict crypto sense, no — equities cannot be staked to secure a Proof‑of‑Stake chain. The closest mainstream equivalent is securities (stock) lending: brokers lend full...

2026-01-10 09:34:00

By Crypto Scribe

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Can You Stake Stocks?

Can you stake stocks? Short answer: not in the technical, blockchain sense. In cryptocurrency, "staking" means locking tokens to support a Proof‑of‑Stake network and earn protocol rewards. Traditional equities cannot perform that role. However, many brokers offer a securities lending program — sometimes marketed as "stock lending" or "fully paid lending" — that lets shareholders earn fees by lending their fully paid shares to institutional borrowers. This guide explains what people mean when they ask "can you stake stocks", how securities lending actually works, how it compares to crypto staking, the benefits and risks, typical broker program terms, and the practical questions to ask your broker.

Key terms and definitions

Staking (crypto): In cryptocurrencies, staking is the act of locking tokens to help validate transactions and secure a Proof‑of‑Stake blockchain. Stakers may receive block rewards, transaction fees, or protocol incentives in return. Staking is protocol-level participation tied to consensus.
Stock staking (misnomer): Retail investors often ask "can you stake stocks" when they mean "can I earn staking-like passive income on my shares?" "Stock staking" is a misnomer because stocks do not operate as blockchain validators or participate in crypto consensus mechanisms.
Securities lending / stock lending: The correct financial term is securities lending (commonly called stock lending for equities). In a securities lending arrangement, a broker or agent arranges for fully paid shares to be loaned to a borrower (for example, a short seller or an institution needing stock for settlement). The lender receives compensation (a lending fee) while the borrower posts collateral to protect the lender.

Why the confusion arises

The question "can you stake stocks" is common because several trends overlap: marketing language from platforms that offer both crypto and stock services, the broader investor desire for passive yield, and product names that emphasize "earning on holdings." Some brokers run both crypto staking services and securities lending programs, which blurs terminology for users. That overlap — plus headlines about institutional crypto staking (for example, large companies staking ETH) — prompts retail investors to ask whether a comparable staking option exists for equities.

Crypto staking vs. stock lending — a direct comparison

Mechanism: Staking validates blocks and secures a PoS blockchain by delegating or locking tokens; securities lending temporarily transfers legal title of shares to a borrower under a loan agreement.
Rewards and payment: Crypto staking yields protocol rewards (new tokens, fees) distributed by the network; stock lending produces borrower fees paid by the borrower and split between broker and client per program terms.
Lockup and liquidity: Crypto staking often involves explicit lockup or unbonding windows; loaned shares can usually be recalled or the loan terminated, but recalls and settlement timing mean liquidity may not be instantaneous.
Rights and protections: Staking typically does not transfer legal ownership of tokens but may limit immediate use; securities lending usually transfers legal title so loaned shares lose voting rights while on loan and dividends may be delivered as payments‑in‑lieu. Protections like SIPC-style insurance vary and do not directly mirror blockchain custody protections.

How securities (stock) lending works

Brokers or their lending agents match lenders (client accounts holding fully paid shares) with borrowers (institutions, hedge funds, market makers) who need the stock to short, settle trades, or cover delivery obligations. Borrowers post collateral, loans are arranged and tracked by the broker, and lenders receive part of the lending fee according to the broker's revenue share schedule.

Step‑by‑step process

Enrollment and eligible holdings: Brokers typically require opt‑in enrollment. Only fully paid, whole shares (not fractional shares or margin‑borrowed positions) are eligible in most programs. Some brokers set minimum account balances or specific eligibility criteria.
Loan initiation and collateral: When a borrower requests a loan, they post collateral (often cash or high‑quality securities) at or above a required percentage (commonly around 100–102% of the loan value for cash collateral). Collateral is held separately and marked‑to‑market.
Fee generation and sharing: The borrower pays a lending fee that reflects supply/demand for that security. The broker retains a portion to operate the lending program and pays the remainder to the client. Revenue splits and fee mechanics vary by broker and security.
Ongoing operations: Loans are marked‑to‑market daily and collateral ratios adjusted. Loans can be recalled (for example, if the lender wants to sell, or ahead of corporate actions) or terminated. Corporate actions and dividends may require special handling.

What the lender still receives

Lenders keep economic exposure to the stock: price gains and losses remain with the account. Distributions are generally reflected back to the lender, but dividends while shares are on loan are often returned as "payments‑in‑lieu" which can have different legal and tax treatment compared with qualified dividends.

Typical broker programs and examples

Several brokers and custodians run stock lending programs; terms and transparency differ.

Stake (Australia/New Zealand): Stake operates a stock lending program with a lending counterparty arrangement. Materials from Stake describe a revenue split model and that DriveWealth is a counterparty in some markets. Stake communicates program eligibility and revenue sharing in its disclosures.
Robinhood: Robinhood runs a stock lending program that loans fully paid shares to support settlement and shorting. Historically, Robinhood has disclosed client revenue shares up to a stated percentage of gross lending revenue, subject to program terms and eligibility thresholds.
Fidelity and large custodians: Major custodians offer fully paid lending programs, often with eligibility minimums (for example, some programs require a minimum account balance). Institutional custodians also run large, bespoke securities lending operations.
Other brokers (TD, etc.): Many full‑service brokerages and custodians run lending desks or participate through agent lenders; program fees, reporting, and client compensation vary.

Note: program details change over time; always check current broker disclosures and agreements before enrolling.

Benefits of participating

Extra income: Stock lending can produce incremental yield on holdings that would otherwise only sit idle.
Maintain market exposure: Lenders retain economic exposure to price changes and may net benefit from upside while earning fees.
Passive participation: Brokers handle matching, collateral monitoring, and administration, letting clients earn without active management.

Risks and important considerations

Counterparty/default risk and collateral shortfall: Borrower collateral is intended to protect lenders, but in extreme market moves or rare failures, collateral may be insufficient or recovery may be slow and complex.
Loss of voting rights: Loaned shares typically do not carry voting rights while on loan; institutional events and shareholder votes may be affected unless the broker recalls shares in advance.
Tax treatment: Payments‑in‑lieu for dividends may not qualify for favorable dividend tax rates and can be taxed differently in some jurisdictions. Lending fees are generally taxed as ordinary income.
SIPC/insurance gaps: Securities on loan may not be covered the same way as fully held securities in a standard custody relationship. Protections depend on the broker's structure, collateral arrangements, and any supplemental insurance.
Operational and corporate action issues: Loans are often unwound for corporate actions, but timing and procedures vary by broker and can affect the lender's position during complex events.

Eligibility, enrollment and operational details to check with a broker

Before enrolling, verify these items with your broker:

Minimum account balances and eligibility thresholds.
Which securities are eligible (no fractional shares, certain ADRs, or specific tickers may be excluded).
Whether enrollment is opt‑in or opt‑out and how to change participation.
Fee split: what percentage of lending revenue the client receives, and any caps or floor arrangements.
Collateral safeguards: what collateral is accepted from borrowers, how it is held, and counterparty risk disclosures.
Ability to recall shares and typical recall lead times.
Reporting and statements: how lending income and loan activity are reported on monthly/annual statements.
Tax forms and qualified/unqualified dividend treatment for payments‑in‑lieu.

Alternatives to “staking” stocks to generate yield

If your goal is to earn passive income or yield on an equity position, consider these alternatives:

Dividend reinvestment plans (DRIPs): Reinvest dividends automatically to compound returns.
High‑yield dividend stocks: Focus on companies with established dividend policies, while considering dividend sustainability.
Covered call writing / options income: Selling covered calls can generate premium income from holdings.
Fixed‑income allocations: Bonds or bond ETFs provide coupon income and portfolio diversification.
Income ETFs: ETFs that target dividend or income strategies can centralize yield exposure.
If seeking true staking: Consider staking crypto tokens on a reputable platform or through a custodial staking service — this is the literal meaning of staking.

Legal, regulatory and tax considerations

Regulatory environment: Securities lending is a regulated market function implemented via broker agreements and collateral rules; regulatory protections and dispute processes differ by jurisdiction and custodian.
Tax implications: Lending income and payments‑in‑lieu may be taxed differently from qualified dividends. Consult a tax advisor for treatment in your jurisdiction.

Always review broker legal disclosures and consult professionals for legal or tax questions.

How to decide if you should participate

Consider these factors when deciding whether to enroll in a lending program:

Investment horizon: Long‑term buy‑and‑hold investors may be better positioned to accept lending activity than short‑term traders.
Importance of voting rights: If exercising shareholder votes matters to you, lending may be unsuitable unless you have clear recall rights.
Tax situation: If you rely on qualified dividends, evaluate how payments‑in‑lieu may affect your tax outcome.
Risk tolerance: Consider counterparty risk, collateral mechanics, and operational exposures.
Broker reputation and disclosure quality: Choose brokers with clear reporting, strong custodial arrangements, and transparent fee splits.
Size of potential yield: Compare incremental lending income to the potential risks and operational friction.

Frequently asked questions

Can I still sell shares that are on loan?

Yes. Selling generally ends the loan, but recalls and settlement timing mean the sale may require the broker to recall the loan first. In practice, brokers manage recalls so clients can trade, but be aware of potential short windows.
Will I receive dividends?

You normally receive the economic equivalent of dividends, but if your shares are on loan the distribution may be delivered as a "payment‑in‑lieu" which can have different legal and tax status from a qualified dividend.
Can lenders lose money?

A loss is unlikely in normal conditions because borrowers post collateral, but in extreme events or counterparty failures recovery can be delayed or incomplete. Broker protections and recovery processes vary.
Is this the same as crypto staking?

No. To reiterate: "Can you stake stocks" — in the literal crypto sense — no. Securities lending is a financial loan of legal title to a borrower; crypto staking is protocol participation to secure a blockchain and earn rewards.

Context from recent crypto staking news

To help frame the scale of crypto staking compared with securities lending activity, note a recent corporate disclosure: As of January 19, 2026, Bitmine reported crypto plus cash and "moonshot" holdings totaling $14.5 billion, including 4,203,036 ETH and significant ETH staking activity. Bitmine stated it had 1,838,003 ETH staked as of that date and described plans to expand staking infrastructure in 2026. This illustrates how large institutional staking operations for crypto exist independently from securities lending markets for equities. (Source: Bitmine press release dated January 20, 2026.)

References and further reading

"Stake — Stock Lending" (Stake product and legal/explainer pages). (Check Stake disclosures for program terms.)
"Robinhood About Stock Lending" (Robinhood program explainer and client disclosures).
"Fidelity — Fully Paid Lending" (Fidelity client materials on securities lending programs).
"Securities lending" — Investopedia overview article explaining how stock lending works.
CNBC explainer on stock lending and short selling (news coverage and examples).
Broker pages (TD and other major custodian explanations of securities lending programs).
Crypto staking primer — overview of staking mechanics and protocol rewards (educational materials).
Bitmine press release (dated January 20, 2026) reporting staking and treasury holdings, including ETH staked figure and total holdings.