Liquid staking, which became the second-largest decentralized finance (DeFi) industry, is an interest-earning technique for proof-of-stake Crypto owners and is seeing its moment in the spotlight thanks to investor and diplomat Justin Sun.
According to data source DefiLlama, the total amount of Crypto assets placed in liquid staking protocols was $14.1 billion as of Monday’s European trading hours, making it the second-largest Crypto market sector. Decentralized exchanges, with deposits of $19.4 billion, kept the top rank, while the total value locked in decentralized finance (DeFi) lending and borrowing protocols was $13.7 billion, the third largest.
Activation in liquid staking, which enables investors to earn interest on their digital currency while simultaneously preserving the assets for other reasons via derivative tokens, was anticipated to pick up steam with the Shanghai update of the Ethereum blockchain scheduled for next month. The largest liquid-staking protocol, Lido, received a $240 million inflow on Saturday in the form of 150,000 ether, which gave the idea a boost (ETH).
The amount was sent to Lido in a series of transactions by Sun, the creator of the Tron blockchain-based operating system, who continued to feed ether into Lido through Monday, said blockchain analytics firm Agora Intelligence. He is now the platform’s largest individual staked ether holder with a balance of $500 million.
Since ETH has a substantially lower staking ratio than other Layer 1 Cryptos, which indicates the proportion of the Crypto’s supply that has been staked, liquid staking is predicted to increase.
