Liquid Stacking: A game-changer for chain growth and liquidity

Liquid Staking is DeFi’s largest sector, with over $43B in TVL, according to DeFiLlama. But what made it catch on so quickly?

Every chains aims to grow its ecosystem, which today mainly means supporting DeFi protocols. But for DeFi to thrive, there needs to be plenty of accessible capital seeking strong returns

The challenge is that many chains today leverage PoS systems, where users lock up tokens to help secure the network and earn reliable yields.

But with tokens locked, users lose the option to use that capital in DeFi. Furthermore, solo stakers must run nodes that maintain high uptime and often need a large number of tokens to even start staking. For instance, Ethereum requires a minimum of 32 ETH and has slashing risks if you don’t run a node properly.

Liquid Staking changes the game. Now, users can earn staking rewards while receiving a liquid token they can use in DeFi or swap back for their staked tokens anytime.

Plus, the experience with Liquid Staking protocols is often much smoother than staking alone, as it removes the need for any technical knowledge and the minimums required to earn rewards.

For this reason, users rely more often on protocols like Lido and Jito, which enables them to take advantage of DeFi opportunities.

The numbers behind Liquid Stacking growth

Take Lido, for example: about 28% of all staked ETH—worth $24B—sits with Lido, highlighting strong demand for easy staking options.

Moreover, 33% of stETH (Lido's Liquid Staking token) is used in DeFi, showing that users were waiting for a way to access further yield with their staked assets.

Similar trends are seen with Jito on Solana, where 35% of JitoSOL is actively deployed across DeFi protocols.

These numbers show that, alongside stablecoins, liquid staking is the strongest way to unlock liquidity within an ecosystem.

Stacking DAO: Liquid Staking on Stacks

Stacking DAO is the leading liquid stacking protocol on Stacks, with $100M in TVL. In less than a year, the protocol has made 13% of staked STX liquid again.

Even more impressive, 49% of the available stSTX is already being used in Stacks DeFi protocols, helping new projects get started with initial liquidity and community support.

The impact of Stacking DAO can't be understated and expect the protocol to bring even more liquidity in DeFi as some cool things are under development.

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Stacking DAO Details:

Mint stSTX today and earn up to 10% yield on your STX: https://app.stackingdao.com/

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