CZ is constantly in search of innovation and his thirst for the unknown pushes him a little further every day. Recently, BNB Chain, the blockchain behind the crypto platform, introduced a new feature: liquid staking. In partnership with three main protocols.
Ethereum (ETH), spearhead of liquid staking?
The crypto ecosystem is constantly evolving. However, the Merge announcement of Ethereum, the second largest blockchain, had a huge impact. Indeed, the migration of Proof-of-Work to the Proof-of-Stake (PoS) has given liquid staking a big boost. Its growing popularity, more and more exchanges are interested in it and Binance is not exempt from it.
Just like traditional staking, liquid staking has many advantages. But in the second, users who have locked their assets for a certain use receive new tokens of equivalent value. These tokens, which represent ownership of the underlyings, are fully transferable and users can unwrap them to collect staked assets.
The particularity of these products is that users can use them to generate returns. Moreover, with the introduction of BNB Chain, users have the opportunity to earn interest. To do this, they only have to assign the BNB token to the liquid staking protocols and they will receive tradable aBNBc, BNBX and stkBNB tokens in return.
Many exchanges join the movement
According to Gwendolyn Regina, Chief Investment Officer at BNB Chain, the total locked market capitalization of staking platforms is 24%. Because of this, she thinks users aren’t really aware of the benefits of staking. With the growing popularity of liquid staking, more and more crypto exchanges are taking an interest in it. Coinbase announced last week that it plans to offer its own liquid staking token called cbETH.
Before him, Lido Finance said in July that it would soon offer ether staking on Layer 2 networks. To go even further, Helio Money is offering a new asset class it calls destablecoin. But unlike stablecoins, which peg on crypto assets such as USDC, destablecoins like Helios’ HAY will use BNB as collateral.
Earlier this month, Stader, a staking-as-a-service platform, and pStake, a liquid staking protocol, went live on BNB Chain. According to a statement, they together staked 101,100 BNB on Monday with Ankr, or $30 million in total value locked.
BNB Chain launches liquid staking with many advantages. However, if it seems to have only positive aspects, CZ Remember, however, that staking involves risks. Even though the Binance blockchain surrounds itself with three competitive protocols to reduce the risk of concentration and single failure, it is necessary to know exactly what it is about before jumping in.
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