Staking is the primary value accrual strategy of Olympus Doge. Stakers stake their $OHMD on the Olympus Doge website to receive sOHMD tokens and earn rebase rewards. The rebase rewards come from the expansion of the supply from the treasury. $OMHD and sOHMD are always redeemable 1:1, and profits are always distributed equally through rebase.
Staking is a passive, long-term strategy. The increase in your $OHMD tokens translates into a constantly falling cost basis converging on zero. This means even if the market price of $OHMD drops below your initial purchase price, given a long enough staking period, the increase in your staked $OHMD balance should eventually outpace the fall in price.
When you stake, you lock OHMD and receive an equal amount of sOHMD. Your sOHMD balance rebases up automatically at the end of every epoch (8 hour period). sOHMD is transferable and therefore composable with other DeFi protocols.
When you unstake, you burn sOHMD and receive an equal amount of $OHMD. Unstaking means the user will forfeit the upcoming rebase reward. Note that the forfeited reward is only applicable to the unstaked amount; the remaining staked $OHMD (if any) will continue to receive rebase rewards