What is liquid staking?

Liquid staking is a process in which users can stake (lock) 🔒 their cryptocurrencies to earn rewards 🎁 while still retaining the ability to use liquid assets.

Unlike traditional staking, where your funds are blocked for a certain period, liquid staking allows you to receive what are called staking derivatives – tokens representing the staked assets.

How it works:

🔵 You stake your cryptocurrencies (e.g. Ethereum or other PoS tokens) via a liquid staking platform.
🔵 In exchange, you receive derivatives, which are tokens linked to your staked assets.
🔵 These derivatives can be used in DeFi protocols, traded, borrowed, or provided as liquidity, while the original staked assets continue to generate rewards. 🪂

Liquid staking is becoming particularly popular on platforms like Lido, where users can stake ETH and other cryptocurrencies while maintaining the liquidity of their assets.

CryptoFam
#LiquidStaking #KeepPhavering, 🦄
#vivelaFrance 🇫🇷