Liquid Staking Opportunity in Eth and Sol Ecosystems
One huge impact of the Defi on the financial system is the independence it has given to users to be sole determinants of their financial outcomes.
It is worthy of note that Centralized financial institutions like banks have experienced a loss or drop in clientele who operate premium savings accounts and this is because the interest rates offered by these banks are relatively low hence people are seeking out places to invest their capitals.
The financial paradigm has shifted towards DeFi. The question is why Defi?
Defi is quite advantageous in many respects like transparency; it allows several individuals and business entities to own a copy of transactions.
What this means is that there Is no single source or controller, everyone is a stakeholder literally and can affect the market.
With more entities subscribing to DeFi and the adoption rate growing rapidly, the Total Value Locked(TVL) across different Blockchains put together is around $100bn and the Ethereum Blockchain makes up a large fraction of this TVL.
In recent times some other chains like Solana, Polkadot, Optimism have been building and partaking in the TVL ratio.
It's just a matter of time before several other layers of Blockchain get adopted and a multichain world is created using their specified protocols to advantage cos one chain can't do it all.
Specification of Chains: Cosmos and ETH as instances
The Cosmos Blockchain which has Atom as its native token can process a bundle and more transactions within a second. In other words, created for speed.
This is further backed up by a low transactional fee(gas fee; the fee paid for transportation on the platform) This is the reason the Cosmos ecosystem is attractive to investors.
It runs on a Proof of Stake mechanism which means users can stake tokens on the chain for APY(Annual percentage yield) and rewards that come in form of tokens, which in turn helps with the security and functionality of the platform.
The Ethereum Blockchain which has Ether or ETH as its native token enables the deployment of smart contracts. The chain operates on a high level of security due to the fact that decentralized applications (dApps) can be built and run without the interference of a third party.
Hence it is highly decentralized. On the ETH smart contract users are allowed leverage to exchange a wide variety of assets ranging from tokens, shares, real estate, etc.
The chain also operates on a Proof of work module which is more like earning due to the effort exerted typical of cryptocurrency mining.
But recent trends show its gradually adopting the Proof of Stake method where users earn by staking and helping to secure the operation of the platform through validators.
So we see staking as a very important part of these ecosystems
Staking helps give you a passive kind of income and contributes to platform security. There are several kinds of Staking but the focus is on liquid Staking.
In liquid Staking, the staked funds are not locked up over the staking period. Liquid Staking allows you have access to your funds while you stake them. This works by the provision of the tokenized version of the fund you staked.
For instance, you stake ETH you get stETH or staking XPRT to get more tokens. These tokenized versions can be used to buy or sell just like any real fund or can be used to stake further.
An example of a cryptocurrency platform that offers liquid Staking options is Persistence. With the maturity in the Proof of Stake ecosystem will come a great need for PoS tokens to be staked - locked on-chain to enhance network security; this will in turn make liquid staking an indispensable gateway to DeFi.
With over $280B of PoS assets are locked in staking, pSTAKE stands out as one reliable liquid staking platform. As a staker of PoS tokens, you can now maintain the liquidity of your assets while staking your assets simultaneously.
Staking on pSTAKE earns users rewards for staking and 1:1 stkTOKENS; pegged staked representative tokens used in generating additional yield in DeFi.
Persistence and PStake
Persistence is a DeFi application ecosystem with its focus obviously on DeFi as well as NFTs and Liquid staking. The platform structure is based on the proof of stake mechanism thereby giving users the opportunity of staking tokens.
To this end, Persistence developers introduced a new generation product called PStake which is used for liquid staking. With Pstake, users can convert their cryptocurrency into tokens then proceed to stake them if desired or use them In the DeFi market.
The Pstake app is on Ethereum for holders of the Cosmos token ATOM, when you deposit your ATOM token onto Pstake, your ATOM would be deposited and a liquid ATOM called PATOM would be created on Ethereum then PATOM can be staked to receive additional yield in form of stkATOM which is a liquid representative of our staked ATOM that can then be deployed within Ethereum applications.
The Ethereum ecosystem is connected to Persistence via the PBridge.
But are there Liquid staking opportunities for other ecosystems on Persistence? The answer is yes there are opportunities for hosting other Cryptocurrencies in form of tokens. pSTAKE allows the issuance of representative tokens on the Ethereum chain which then can be utilized in the DeFi ecosystem on Ethereum.
So there's already the opportunity of liquid staking for the ETH ecosystem
PStake will also be used to support the SOL ecosystem which due to the number of stakers on this platform has given rise to almost equal proportional Liquid staking options available and PStake is about to cover a huge milestone shortly by enabling Solana SOL on its platform.
This collaboration to enact an opportunity for the SOL ecosystem could be seen brewing during the Solana Season Hackathon organized on May 18, 2021. The CEO of Persistence; Tusher Aggarwal alongside other industry titans helped accelerate the Growth of the Solana ecosystem. This indeed promises to be a development to look out for.
As the future holds more for Liquid Stakers on the Persistence platform. Eventually, Ethereum 2.0, Solana, and other Cosmos-based chains will be supported by pSTAKE liquid staking support as it expands.
Staking and staking Pstake
staking is a process used to verify cryptocurrency transactions. It involves committing holdings to support a blockchain network and confirm the transactions.
It also allows participants to earn passive income on their holdings. ... It is because the blockchain puts your holding to work more like what the bank does with your savings only difference is interest rates are often times higher than banks.
Liquid staking is named so because it allows your assets to be liquid following you delegating them to a validator node