How Liquid Staking Improves Blockchain Liquidity and Utility?


Earning passively in the crypto sector is an exciting adventure that every crypto investor wants to take. There are numerous activities that can be carried out in the space to maximise the profits that individuals receive. Staking is one of these, and it entails delegating some of your assets to a validator in order to support a network and then earning incentives on top of it.

Staking was improved with liquid staking, and instead of simply locking up assets and waiting for staking payouts, users now receive derivative tokens that they may use to engage in DeFi. This new type of staking is extremely advantageous in terms of providing liquidity to investors while also enhancing the utility of blockchains.

Staking with Liquids Increases Liquidity

Consider liquid staking ATOM on a well-known liquid staking platform with a reasonable TVL. You will receive derivative tokens stkETH, stkATOM, stkXPRT, and stkBNB in exchange. These tokens can then be used as collateral on centralised or decentralised exchanges.

As well as lending pools. To generate dividends, the tokens can also be placed in liquidity pools. All of this is in addition to the staking rewards accumulated from the original staked assets. This represents a significant increase in liquidity for crypto users.

The Use of Liquid Staking Increases the Liquidity of the Blockchain

Blockchain usefulness encompasses the technology’s varied potentials and cutting-edge applications. It has the ability to improve transaction or operation efficiency. It increases transparency, diversifies revenue streams, ensures decentralisation, and much more. Liquid staking contributes to blockchain’s ability to create and realise these numerous services and goals.

With liquid staking, users are exposed to new income streams. There is also a strong push for decentralisation because anyone, anywhere in the world, may easily subscribe, stake, and begin earning. Liquid staking, which is derived from PoS staking, ensures that a blockchain is protected. Before users can earn liquid staking derivative tokens, they must first stake the original assets, which greatly contributes to liquid staking.

Liquid Staking Improves Blockchain Liquidity and Utility?

Using liquid staking, investors can earn staking rewards while also accessing their funds without locking them up in staking contracts. Liquid staking is a new solution for a variety of issues in the proof-of-stake (PoS) ecosystem. It creates an additional layer of composability and allows for more efficient capital use.

Liquid staking has become a vital component in the crypto space as more investors are supporting proof-of-stake networks. It is also an effective way to earn an extra yield on idle capital. Unlike traditional staking, liquid staking allows users to stake Ether and other tokenized assets without locking up the funds.

pStake is the largest liquid staking platform for ether. Its stETH token is the most popular derivative in the liquid staking market. The company’s stETH token is a “bond” like token that represents staked Ether. It is traded on DEXes like ETH.

pStake’s stETH token also incurs gas costs with each transaction. The value of the token increases over time as the network earns rewards. This allows users to redeem their tokens at any time.

pStake is not the only platform offering liquid staking for ether. Four platforms have already launched BNB liquid staking services. The staking market for BNB is smaller than that for ether. The company plans to add more chains in the future.

pStake is a strong contender for the ether staking market because of its strong security and user-friendly platform. It currently holds about 7.4 billion dollars in staked assets. The company’s market share is more than 30 percent.


As a result, liquid staking significantly increases the liquidity and utility of blockchains. Income producing sources are expanding, decentralisation is on the rise, and mainstream use is exploding.