Comparison of the Staking Volume, Yield, Governance Token Performance, and DeFi Applications of Solana Liquidity Staking Platforms Marinade, Jito, BlazeStake, and Lido.
With the market recovery, Solana (SOL) has risen to become the sixth-largest cryptocurrency and ranks second in terms of staked assets among all proof-of-stake (PoS) blockchains, second only to Ethereum.
However, compared to its market position, the concentration of funds in decentralized finance (DeFi) applications in the Solana ecosystem is relatively low, with a total value locked (TVL) of $1.137 billion, accounting for only 11.3% of its historical high.
In Solana’s TVL, liquidity staking projects play a crucial role in driving the TVL back to its historical high. Among these projects, Marinade and Jito have occupied a significant position with their highest TVL, highlighting the importance of liquidity staking platforms.
This article will delve into the important participants in the liquidity staking field on Solana and analyze their strategies and market performance.
According to Staking Rewards data, as of December 12, the market capitalization of SOL was $30.53 billion, the staked market value was $27.62 billion, the staking ratio was 69.18%, the staked quantity was 391 million SOL, the inflation rate was 6.75%, and the reward rate was 6.87%. Among them, the staked market value of SOL ranks second among all PoS blockchains, second only to ETH, and the staking ratio is relatively high among PoS blockchains with high market capitalization.
Marinade data shows that there are a total of 1,986 validators in Solana, and the top validators provide an APY close to 8% without any commission.
To reward SOL holders, increase network security and censorship resistance, the Solana Foundation launched the “Staking Pool Program,” allowing users to deposit SOL into the staking pool and receive SPL tokens representing their shares in the staking pool. These SPL tokens are liquidity staking tokens (LST) that can freely circulate.
According to Solana Compass data, the staking pool currently locks 16.82 million SOL, with an average APY of 6.68%. Therefore, SOL in the staking pool accounts for approximately 4.3% of the total staked volume. The top 4 staking pools are Marinade, Jito, BlazeStake, and Lido, which are the four largest liquidity staking projects in the Solana ecosystem.
Marinade Finance is the earliest liquidity staking protocol in the Solana ecosystem. It was established with the support of the Solana ecosystem in the 2021 Spring Solana x Serum Hackathon and launched its liquidity staking protocol on the Solana mainnet in August 2021. Staking SOL on Marinade can earn mSOL, and staking rewards are directly accumulated in mSOL.
Unlike other projects, Marinade also provides native staking services, allowing users to earn staking rewards without using any smart contracts (and without LST). Marinade has a staked volume of 7.058 million SOL, the highest among all liquidity staking projects on Solana, and has the highest TVL of $777 million. The staking yield is 6.543%, and the staked volume has increased by 31.22% in the past 30 days. Marinade’s governance token is MNDE, with a circulating market value of $85.99 million and a total market value of $356 million, with a 7-day increase of 22.2%.
Jito completed its Series A financing led by Multicoin Capital and Framework Ventures in August 2022 and launched its liquidity staking platform at the end of 2022. Staking SOL on Jito can earn JitoSOL, and staking rewards are directly accumulated in JitoSOL.
Unlike other liquidity staking projects, Jito has built the largest Miner Extractable Value (MEV) infrastructure for the Solana network, including products such as Jito Solana, Jito Bundles that allow searchers to send transaction packages to validators, Jito Block Engine, and MEV distribution system. Due to its own MEV business, a portion of the MEV revenue is distributed to JitoSOL, so users who stake through Jito also enjoy higher yields. Jito has a staked volume of 6.38 million SOL, an increase of 17.77% in the past 30 days, a TVL of $455 million, and a staking yield of 6.892%. Jito’s governance token is JTO, with a circulating market value of $342 million and a total market value of $2.973 billion, with a 7-day increase of 46.6%.
BlazeStake was originally a niche staking pool launched in May 2022 but recently surpassed Lido to become the third-largest liquidity staking project on Solana due to the collective explosion of the Solana ecosystem. Staking SOL on BlazeStake can earn bSOL, and staking rewards are directly accumulated in bSOL.
BlazeStake primarily uses Solana Labs’ official staking pool smart contract, which has the largest set of validators and allows users to stake liquidity to specific validators. BlazeStake has a staked volume of 1.52 million SOL, a 30-day growth of 177%, a TVL of $108 million, and a staking yield of 6.232%. Blaze’s governance token is BLZE, with an undisclosed circulating market value and a total market value of $38.84 million, with a 7-day increase of 66.5%.
Lido launched its liquidity staking service on Solana in September 2021 and dominated the liquidity staking on ETH. However, its development on other chains has not been ideal, and it announced in October that it would stop accepting new staking on Solana. Staking SOL on Lido can earn stSOL, and staking rewards are also accumulated in stSOL.
Lido has a staked volume of 0.887 million SOL, a 30-day decrease of 41.43%, a TVL of $634 million on Solana, and a staking yield of 6.717%. Lido’s governance token is LDO, with a circulating market value of $209.5 million and a total market value of $235.6 million, with a 7-day decrease of 6.7%.
Marinade’s mSOL, Jito’s JitoSOL, Blaze’s bSOL, and Lido’s stSOL have all received good support in Solana’s DeFi applications.
The two largest lending protocols on Solana, marginfi and Solend, support mSOL, JitoSOL, bSOL, and stSOL as collateral for borrowing. However, after Lido announced its launch, stSOL was delisted from these two projects.
In the largest DEX on Solana, Orca, both mSOL/SOL and bSOL/SOL have liquidity of over $10 million, and there are also trading pairs between mSOL and bSOL. However, liquidity for Jito/SOL and stSOL/SOL is relatively low.
The growth of staked volume and liquidity in DEX may be related to the incentive measures. Blaze provides the highest incentives, offering APR 15.37% subsidy in BLZE governance tokens for deposits in Solend, and APR 1.98% subsidy in MNDE governance tokens for mSOL deposits. Jito has not yet provided incentives for the adoption of JitoSOL in DeFi, and Lido has already distributed most of its tokens and is unable to participate in the subsidy war, choosing to exit the market.
The Solana ecosystem includes various representative liquidity staking solutions, all of which have received support from DeFi projects in the ecosystem. Marinade was the first to launch and has native staking services. Jito provides higher returns through its MEV infrastructure. BlazeStake allows users to stake SOL to specific validators, and Lido is a representative multi-chain liquidity staking service provider.
However, the total volume of liquidity staking is relatively small, with SOL staked through staking pools accounting for only 4.3% of all staked SOL. The abundance of liquidity solutions also leads to liquidity dispersion, and competitive solutions may emerge in the future, such as marginfi’s LST.
Incentive measures still seem crucial for increasing staked volume and liquidity in DEX. Blaze has the lowest name recognition but provides the highest APR subsidies in DEX and lending protocols, resulting in a 30-day increase in staked volume by 177%.
Despite having the largest name recognition in the liquidity staking field, Lido, which was launched early on Solana, has nearly distributed all of its tokens and is unable to participate in the subsidy war, leading to its decision to shut down.
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