Solana Staking Market: Leaders in the Liquid Staking Space

Recently, the market has warmed up, and Solana (SOL) has jumped to become the sixth largest cryptocurrency. Among all proof-of-stake (PoS) blockchains, its staked asset scale is second only to Ethereum. However, the degree of capital aggregation in decentralized finance (DeFi) applications within the Solana ecosystem is relatively low, with a total locked value (TVL) of $1.137 billion, which is only 11.3% of its historical peak.

In the TVL of Solana, liquid staking projects hold an important position and are key to the recovery of TVL. Marinade and Jito, with the highest TVL, have become leaders, highlighting the significance of the liquid staking category. This article will delve into the important participants in the Solana liquid staking space and conduct a comparative analysis of their strategies and market performance.

Staking and Liquid Staking Overview

As of December 12, the market value of SOL is $30.53 billion, with a staking market value of $27.62 billion, a staking ratio of 69.18%, and a staking amount of 391 million SOL. The inflation rate is 6.75%, and the reward rate is 6.87%. The staking market value of SOL ranks second among PoS public chains, second only to ETH; the staking ratio is also relatively high among the PoS public chains with larger market values.

Solana has a total of 1,986 validators, with the top-ranked validators offering an APY close to 8%, with no commission.

To reward SOL holders, enhance network security, and improve censorship resistance, the Solana Foundation has launched the “staking pool program”. Users can deposit SOL into the staking pool and receive SPL tokens representing their share, known as liquid staking tokens (LST). A total of 16.82 million SOL is locked in the staking pool, providing an average APY of 6.68%, which accounts for approximately 4.3% of the total staked amount. The top four staking pools are Marinade, Jito, BlazeStake, and Lido.

Analysis of Main Liquid Staking Projects

Marinade Finance

Marinade Finance is one of the earliest liquid staking protocols in the Solana ecosystem, launched on the mainnet in August 2021. Users can stake SOL to receive mSOL, and staking rewards are directly accumulated in mSOL. Marinade also offers native staking services, allowing users to earn staking rewards without the need for smart contracts.

• Staked Amount: 7.058 million SOL (maximum)
• TVL: $777 million (highest)
• staking yield: 6.543%
• 30-day stake volume increase: 31.22%
• Governance Token: MNDE (Circulating Market Cap $85.99 million, Total Market Cap $356 million)

Jito

Jito launched its liquid staking platform at the end of 2022. Users can stake SOL to receive JitoSOL, with staking rewards accumulating in JitoSOL. Jito has developed MEV infrastructure for the Solana network, with a portion of the MEV rewards distributed to JitoSOL, allowing staking users to receive higher returns.

• Stake Volume: 6.38 million SOL
• TVL: $455 million
• stake yield: 6.892%
• 30-day stake volume increase: 17.77%
• Governance Token: JTO (Circulating Market Cap $342 million, Total Market Cap $2.973 billion)

BlazeStake

BlazeStake was launched in May 2022 and has rapidly developed recently due to the explosion of the Solana ecosystem. Users can stake SOL to receive bSOL, and staking rewards accumulate into bSOL. BlazeStake primarily utilizes the official staking pool smart contract from Solana Labs, boasting the largest set of validators.

• Stake amount: 1.52 million SOL
• TVL: $108 million
• Stake yield: 6.232%
• 30-day stake volume increase: 177%
• Governance Token: BLZE (Total Market Cap: $38.84 million)

Lido

Lido launched liquid staking services on Solana in September 2021. Users can stake SOL to receive stSOL, with staking rewards accumulating in stSOL. However, Lido failed to leverage its first-mover and brand advantages and announced in October that it would stop accepting new stakes on Solana.

• Staked Amount: 887,000 SOL
• TVL: 63.4 million USD
• Stake Yield: 6.717%
• 30-day stake volume change: decreased by 41.43%
• Governance Token: LDO (Circulating Market Cap $2.095 billion, Total Market Cap $2.356 billion)

Application of LST in DeFi

Major LSTs (mSOL, JitoSOL, bSOL, stSOL) are widely supported in Solana’s DeFi applications.

• Lending: marginfi and Solend support mSOL, JitoSOL, bSOL as collateral.
• DEX: In Orca, mSOL/SOL and bSOL/SOL have over ten million dollars in Liquidity.

The growth of staking volume is closely related to DEX liquidity and project incentive measures. Blaze offers the highest incentives, followed by Marinade, while Jito has not yet provided incentives for the adoption of JitoSOL in DeFi. Lido has chosen to exit the market due to the fact that its tokens have been mostly distributed and it is unable to provide further incentives.

Conclusion

There are various representative liquid staking solutions in the Solana ecosystem, all supported by DeFi projects. Marinade was the first to launch and provides native stake services; Jito offers higher yields through MEV infrastructure; BlazeStake allows staking to specific validators; and Lido represents a multi-chain liquid staking service provider.

However, the total amount of liquid staking is still relatively small, with only 4.3% of all staked SOL being staked through staking pools. The diversification of liquidity solutions has led to dispersed liquidity, and more competitive solutions may emerge in the future.

Incentives are still crucial for increasing staking volume and LST liquidity. Blaze, although the least known, has achieved rapid growth in staking volume through high subsidies. In contrast, Lido, despite its high profile in the liquid staking field, has chosen to exit the Solana market due to its inability to participate in the subsidy competition.