Solana Stake Market Analysis: Leaders in the Liquid Staking Field

Recently, the cryptocurrency market has warmed up, and Solana (SOL) has risen to become the sixth largest cryptocurrency. Among all proof-of-stake (PoS) blockchains, its staked assets are second only to Ethereum. However, the level of capital accumulation 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 Solana's TVL, liquid staking projects play a crucial role and are key to driving the TVL back to historical highs. Marinade and Jito occupy significant positions with the highest TVL, highlighting the importance of the liquid staking category. This article will delve into the important participants in the Solana liquid staking space and provide a comparative analysis of their strategies and market performance.

Stake and Liquid Staking Overview

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

There are a total of 1986 validators in Solana, and the top-ranked validators offer an APY of nearly 8%, with no commission required.

To reward SOL holders and enhance the network's security and censorship resistance, the Solana Foundation has launched the "staking pool program," allowing users to deposit SOL into staking pools and receive SPL tokens that represent their share in the staking pool. These SPL tokens are liquid staking tokens (LST) and can circulate freely. A total of 16.82 million SOL is locked in the staking pool, with an average APY of 6.68%. The SOL in the staking pool accounts for about 4.3% of the total staked amount. The top four staking pools are Marinade, Jito, BlazeStake, and Lido, which are the four largest liquid staking projects in the Solana ecosystem.

Marinade Finance

Marinade Finance is one of the earliest liquid staking protocols in the Solana ecosystem, launched on the Solana mainnet in August 2021. Staking SOL on Marinade earns mSOL, and staking rewards are directly accumulated in mSOL.

Unlike other projects, Marinade also offers native staking services, allowing users to earn staking rewards without using any smart contracts (and thus without LST).

Marinade has 7.058 million SOL staked, making it the largest liquid staking project on Solana; it also has the highest TVL on Solana, valued at $777 million; the staking yield is 6.543%; the staking amount has increased by 31.22% in the past 30 days.

The governance token of Marinade is MNDE, with a circulating market cap of $85.99 million and a total market cap of $356 million, having increased by 22.2% in the past 7 days.

Jito

Jito launched its liquid staking platform at the end of 2022. In Jito, staking SOL can earn JitoSOL, and staking rewards are directly accumulated into JitoSOL.

Jito has developed the Maximum Extractable Value (MEV) infrastructure for the Solana network, including the Jito Solana client, Jito Bundles, Jito Block Engine, and the MEV distribution system. Due to its own MEV operations, a portion of the MEV profits is allocated to JisoSOL, making the returns for users staking through Jito relatively higher.

There are 6.38 million SOL staked in Jito; the staking amount has increased by 17.77% over the past 30 days; the TVL is $455 million; 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, up 46.6% in the past 7 days.

BlazeStake

BlazeStake was launched in May 2022 and has recently surpassed Lido to become the third largest liquid staking project due to the collective explosion of the Solana ecosystem. By staking SOL in BlazeStake, users can receive bSOL, and the staking rewards are directly accumulated into bSOL.

BlazeStake primarily uses the official staking pool smart contract from Solana Labs, featuring the largest set of validators, allowing users to liquid stake to specific validators.

BlazeStake has staked 1.52 million SOL; the staking amount has increased by 177% in the past 30 days; the TVL is $108 million; the staking yield is 6.232%.

The governance token of Blaze is BLZE, with a total market value of 38.84 million USD, up 66.5% in the past 7 days.

Lido

Lido launched its liquid staking service on Solana in September 2021, but its development did not meet expectations, and it announced in October that it would stop accepting new stakes on Solana. Staking SOL in Lido earns stSOL, and the staking rewards are also accumulated in stSOL.

Lido has 887,000 SOL staked; the staking volume has decreased by 41.43% in the past 30 days; the TVL on Solana is $63.4 million; the staking yield is 6.717%.

Lido's governance token is LDO, with a circulating market cap of $2.095 billion and a total market cap of $2.356 billion, down 6.7% in the past 7 days.

The Application of LST in DeFi

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, both support mSOL, JitoSOL, and bSOL as collateral for borrowing, but stSOL has been delisted.

In the largest DEX Orca on Solana, both mSOL/SOL and bSOL/SOL have liquidity exceeding ten million dollars, and there are also direct trading pairs between mSOL and bSOL; while the liquidity of Jito/SOL and stSOL/SOL is relatively low.

The increase in staking volume and liquidity in DEX may be related to the project's incentive measures. Blaze offers the highest incentives, with deposits on a certain lending platform earning a 15.37% APR in BLZE governance token subsidies, and mSOL deposits earning a 1.98% APR in MNDE governance token subsidies. Jito has not yet provided incentives for the adoption of JitoSOL in DeFi, while Lido's tokens have already been largely distributed, making it unable to provide further incentives and choosing to exit the market.

Summary

The Solana ecosystem includes several representative liquid staking solutions, all supported by DeFi projects within the ecosystem. Marinade was the first to launch and offers native staking services; Jito provides higher yields through MEV infrastructure; BlazeStake allows users to stake SOL to specific validators; Lido represents the multi-chain liquid staking service providers. However, the total amount of liquid staking is relatively small, with only 4.3% of all staked SOL being staked through staking pools.

Incentives seem to still be crucial for the increase in staking volume and the liquidity of LST in DEX. The Blaze project, although the least well-known, has provided the highest APR subsidies in DEX and lending protocols, with a 177% increase in staking volume over the past 30 days. In contrast, Lido, despite being the most prominent in the field of liquid staking and having launched on Solana relatively early, has chosen to shut down due to the fact that almost all its tokens have been distributed, rendering it unable to participate in the subsidy war.

With the continuous development of the Solana ecosystem, more competitive solutions may emerge in the field of liquid staking, and the future market landscape is worth looking forward to.