Analysis of Solana Staking Market Depth: Four Major Market Makers in the Liquid Staking Field

As the cryptocurrency market warms up, Solana (SOL) has climbed to the position of the sixth largest cryptocurrency. Among all proof-of-stake (PoS) blockchains, Solana's staked asset scale is second only to Ethereum. However, relative to its market position, the level of capital aggregation in decentralized finance (DeFi) applications within the Solana ecosystem is relatively low, with a total value locked (TVL) of $1.137 billion, only 11.3% of its historical high.

In Solana's TVL, liquid staking projects play a key role, serving as an important force driving the recovery of TVL to historical highs. In this sector, Marinade and Jito hold significant positions with the highest TVL, highlighting the importance of the liquid staking category. This article will delve into the key players 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 staking market value of $27.62 billion, a staking ratio of 69.18%, and a staking amount of 391 million SOL. The inflation rate is 6.75%, and the reward rate is 6.87%. The staking market value of SOL ranks second among all PoS public chains, only behind ETH; the staking ratio is also relatively high among the top market capitalization PoS public chains.

There are a total of 1986 validators in the Solana network, with the top-ranked validators offering an APY close to 8%, all without any commission.

To reward SOL holders and enhance network security and resistance to censorship, Solana has launched the "staking pool program," allowing users to deposit SOL into the staking pool and receive SPL tokens representing their share in the staking pool. These SPL tokens are the liquid staking tokens (LST) and can circulate freely. Data shows that 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 approximately 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 rewards you with mSOL, and the staking yield is directly accumulated into mSOL.

Marinade also offers native staking services, allowing users to earn staking rewards without using any smart contracts.

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

The governance token of Marinade is MNDE, with a circulating market value of 85.99 million USD, a total market value of 356 million USD, and an increase of 22.2% over the past 7 days.

Jito

Jito launched its liquid staking platform at the end of 2022. By staking SOL in Jito, you can obtain JitoSOL, and the staking rewards are directly accumulated into JitoSOL.

Jito has developed maximum extractable value (MEV) infrastructure for the Solana network, including the Jito Solana client, Jito Bundles, Jito Block Engine, and the MEV allocation system. Due to its own MEV business, a portion of the MEV earnings will be allocated to JisoSOL, making the returns for users staking through Jito relatively higher.

There are 6.38 million SOL staked in Jito; the staking volume 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, a total market cap of $2.973 billion, and an increase of 46.6% over the past 7 days.

BlazeStake

BlazeStake was launched in May 2022, and recently, due to the collective explosion of the Solana ecosystem, the governance token has increased several times from its low point, surpassing Lido to become the 3rd largest liquid staking project on Solana. 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, which has 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 on other chains has not been ideal, failing to capitalize on its first-mover advantage and brand strength. It announced in October that it would stop accepting new stakes on Solana. Staking SOL in Lido can yield stSOL, and the staking rewards are also accumulated into stSOL.

There are 887,000 SOL staked in Lido; the staking volume has decreased by 41.43% in the past 30 days; the TVL on Solana is 63.4 million dollars; 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% over the past 7 days.

The Application of LST in DeFi

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

In the largest DEX Orca on Solana, both mSOL/SOL and bSOL/SOL have liquidity exceeding ten million dollars, and there are also trading pairs between mSOL and bSOL that can be traded directly; while the liquidity for 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 an APR of 15.37% in BLZE governance token subsidies for deposits in Solend, and an APR of 1.98% in MNDE governance token subsidies for mSOL deposits. Jito has yet to incentivize the adoption of JitoSOL in DeFi, while Lido's tokens have mostly been distributed, leaving it unable to provide further incentives and choosing to exit the market.

Summary

The Solana ecosystem includes various representative liquid staking solutions, all of which are supported by DeFi projects within the ecosystem. Marinade was the first to launch and offers native staking services; Jito provides higher returns through MEV infrastructure; BlazeStake allows users to stake SOL with specific validators; Lido is a representative of 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. The abundance of liquidity solutions has also led to a dispersion of liquidity, and some competitive solutions may emerge in the future.

Incentive measures seem to be crucial for the increase in staking volume and the liquidity of LST on DEXs. The Blaze project has the least fame, but it has provided the highest APR subsidies in DEX and lending protocols, with a 177% increase in staking volume over the past 30 days. Although Lido has the greatest fame in the liquid staking field and launched on Solana relatively early, almost all of its tokens have been distributed, making it unable to participate in the subsidy battle and choosing to shut down.