Comparison of Solana’s Liquidity Staking Projects: Marinade, Jito, BlazeStake, and Lido in terms of Staked Amount, Yield, Governance Token Performance, and Applications in DeFi
Summary:
As the market recovers, Solana (SOL) has risen to become the sixth-largest cryptocurrency and the second-largest staking asset among all Proof-of-Stake (PoS) blockchains, trailing only Ethereum in terms of staked assets.
However, compared to its market position, the concentration of funds in decentralized finance (DeFi) applications within the Solana ecosystem is relatively low, with a Total Value Locked (TVL) of $1.137 billion, accounting for only 11.3% of its all-time high.
In the Solana TVL, liquidity staking projects play a crucial role in driving the TVL back to its peak. Among these projects, Marinade and Jito occupy significant positions with their highest TVL, highlighting the importance of liquidity staking.
This article will delve into the key participants in the liquidity staking space on Solana and provide a comparative analysis of their strategies and market performance.
According to Staking Rewards data, as of December 12, Solana’s market cap is $30.53 billion, staked market cap is $27.62 billion, staking ratio is 69.18%, staked quantity is 391 million SOL, inflation rate is 6.75%, and reward rate is 6.87%. Solana’s staked market cap ranks second among all PoS chains, second only to ETH, and the staking ratio is relatively high among PoS chains with higher market caps.
Marinade Finance:
Marinade data shows that there are a total of 1,986 validators in Solana, and the top validators offer an APY close to 8% without any commission.
To reward SOL holders, enhance network security and censorship resistance, the Solana Foundation has 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 known as Liquidity Staking Tokens (LST) and can freely circulate.
According to Solana Compass data, the staking pool has locked a total of 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 amount. 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 during the 2021 Spring Solana x Serum Hackathon and launched the liquidity staking protocol on the Solana mainnet in August 2021. Staking SOL on Marinade yields mSOL, and the staking rewards accumulate directly into mSOL.
Unlike other projects, Marinade also provides native staking services, allowing users to earn staking rewards without using any smart contracts (i.e., no LST).
Marinade has a staked amount of 7.058 million SOL, which is the highest among liquidity staking projects on Solana and also the highest TVL project on Solana with a value of $777 million. The staking yield is 6.543%, and the staked amount has increased by 31.22% in the past 30 days.
Marinade’s governance token is MNDE, with a circulating market cap of $85.99 million and a total market cap of $356 million. It has increased by 22.2% in the past 7 days.
Jito:
Jito completed a Series A funding 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 yields JitoSOL, and the staking rewards accumulate directly into JitoSOL.
Unlike other liquidity staking projects, Jito has developed the largest Minimum Extractable Value (MEV) infrastructure for the Solana network. Its products include Jito Solana, Jito Bundles that allow searchers to submit transaction packages to validators, Jito Block Engine, and MEV distribution systems. Due to its MEV business, a portion of the MEV revenue is distributed to JitoSOL holders, resulting in higher returns for users staking through Jito.
Jito has a staked amount of 6.38 million SOL, with a 17.77% increase in the past 30 days. Its TVL is $455 million, and the staking yield is 6.892%.
Jito’s governance token is JTO, with a circulating market cap of $342 million and a total market cap of $2.973 billion. It has increased by 46.6% in the past 7 days.
BlazeStake:
BlazeStake was initially a niche staking pool launched in May 2022 but has 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 yields bSOL, and the staking rewards accumulate directly into bSOL.
BlazeStake primarily uses Solana Labs’ official staking pool smart contract, which has the largest validator set, allowing users to stake liquidity to specific validators.
BlazeStake has a staked amount of 1.52 million SOL, with a 177% increase in the past 30 days. Its TVL is $108 million, and the staking yield is 6.232%.
Blaze’s governance token is BLZE, with an undisclosed circulating market cap and a total market cap of $38.84 million. It has increased by 66.5% in the past 7 days.
Lido:
Lido launched its liquidity staking service on Solana in September 2021 and holds a dominant position in Ethereum’s liquidity staking. However, its development on other chains has not been ideal, and it announced in October to stop accepting new staking on Solana. Staking SOL on Lido yields stSOL, and the staking rewards also accumulate into stSOL.
Lido has a staked amount of 0.887 million SOL, with a 41.43% decrease in the past 30 days. Its TVL on Solana is $63.4 million, and the staking yield is 6.717%.
Lido’s governance token is LDO, with a circulating market cap of $209.5 million and a total market cap of $235.6 million. It has decreased by 6.7% in the past 7 days.
Marinade’s mSOL, Jito’s JitoSOL, Blaze’s bSOL, and Lido’s stSOL have 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 has been delisted from these two projects.
In Solana’s largest DEX, 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 amounts and liquidity in DEX may be related to the incentives offered by the projects. Blaze provides the highest incentives, offering a subsidy of 15.37% APR in BLZE governance tokens for deposits in Solend and 1.98% APR 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 continue incentivizing and has chosen to exit the market.
The Solana ecosystem includes various representative liquidity staking solutions, which have received support from DeFi projects within the ecosystem. Marinade was the earliest to launch and offers native staking services. Jito provides higher returns through its MEV infrastructure. BlazeStake allows users to stake SOL to specific validators. Lido represents a multi-chain liquidity staking service provider.
However, the total amount 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 the dispersion of liquidity, and there may be emerging competitive solutions in the future, such as marginfi’s LST.
Incentives still seem crucial for increasing staked amounts and liquidity in DEX. Blaze, despite being the least known project, offers the highest APR subsidies in DEX and lending protocols, resulting in a 177% increase in staked amount in the past 30 days.
Lido, despite having the highest reputation in the liquidity staking field, being an early adopter on Solana, has almost distributed all its tokens and is unable to participate in the subsidy war, leading to its decision to shut down.
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Tags:
BlazeStake
Jito
Lido
LSD
LST
Marinade
Solana
Liquidity Staking
Staking