Introduction to Marinade, Solana’s leading liquid staking protocol and so much more!
#HGEN #mSOL #Marinade # Liquid staking #Solana
As of August 2, 2022, Marinade’s liquid staking dApp has officially celebrated its one one-year anniversary operating its mainnet on Solana!
Why liquid stake SOL instead of stake?
- Total liquidity: mSOL is a collateralized version of staked SOL. Before mSOL, you had to choose between staking your tokens and using them in DeFi or to trade. Marinade perfected the Solana DeFi-Staking double-dip!
- Spread the risk: Validators can go offline or suffer extended periods of delinquency. When this happens, stakers of that validator earn no rewards. For example, in May, validator Dokia Capital shut down its validator and yet 30-plus days later, over 900,000 SOL still remain locked and earning no rewards, but because of their significant amount of stake, are still sent blocks to validate, which they do not, and harms the network. That’s an extreme case. In other cases, a validator may be down for a few days. Or they might change their commission and give less to stakers. With a stake pool like Marinade, you can take SOL stake away from validators who are not performing and direct it to those who are, thus maintaining a competitive APY.
- No waiting: When you stake with an individual validator, you must wait for the next Solana epoch in order to begin earning rewards. Then, to unstake those tokens, you must also wait for the end of the epoch (usually 48–72 hours) to get them back. mSOL, on the other hand, begins accruing value instantly for the holder and can either be unstaked on Marinade or traded 24/7 on DEX’s like Jupiter for SOL or other assets.
- Support Solana DeFi: Liquid staking tokens enable prosperity of DeFi protocols because the user no longer has to choose between staking to a validator or using their tokens in DeFi. Liquid staking contributes to DeFi opportunity for the holder and TVL for the protocols.
Why use mSOL as a liquid staking token on Solana
- Tried and tested: Marinade is the first liquid staking solution on Solana and has passed multiple security audits. Over 7 million mSOL are now on the market!
- Widespread adoption: Marinade is the most widely used liquid staking token on Solana. You can even stake SOL directly from wallets like Solflare and Slope and receive mSOL instantly. And all your favorite DeFi protocols accept it and more NFT marketplace integrations are on the way.
- Total asset liquidity: mSOL is the most abundant liquid staking token with the most supply on the market. It’s also available on central exchanges like FTX and Kraken. Tokens with smaller liquid supply can suffer from extreme trading slippage in certain scenarios. Thanks in part to integration with Jupiter, even large swaps of mSOL suffer minimal slippage (”slippage” is the market price difference between the two token prices and the actual price executed on the trade).
- Benefits the ecosystem: All stake pools have different delegation strategies. Marinade stakes to the most trusted validators by far (over 450 and growing), but it also always avoids the “Superminority” of validators, so you know your stake is contributing to a more censorship resistant Solana. Other stake pools on Solana either delegate a significant amount of your stake to the superminority, harming censorship resistance, or delegate to fewer validators or primarily 0% commission validators. Marinade however will support performant independent validators of any size who have competitive commissions and delegate stake to them.
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