📈Derivatives Feature

Every chain has a security structure that is typically called “proof of [something]”. One popular model is proof of stake (PoS). A user can bond their ETH, ATOM, or SCRT to a validator node and will receive staking rewards in exchange for that lock-up.

The network gets security and the user gets rewards.

When users stake on a Cosmos chain, those tokens have a 21 day unbonding period.

But what if you need to make a trade all of the sudden? It is not possible because these tokens are “illiquid”.

On the other hand, if you have a liquid staking derivative like stkd-SCRT there are some huge benefits:

  • You can still help secure the network and receive auto-compounding staking rewards (the staked token accumulates value relative to native, unstaked SCRT)

  • Since your tokens are not subject to bonding limitations they are “liquid”. Drink up all the possibilities of DeFi like swaps, borrowing, lending, and liquidity providing. This allows greater yield possibilities than if you were to only stake or only hold the native asset.

  • Liquid staking derivatives built by Shade Protocol have the added benefit of being private. Enjoy all of the above benefits while maintaining transactional privacy!

Information provided in this post is for general informational purposes only and does not constitute formal investment advice. Please read the full disclaimer at shadeprotocol.io/disclaimer before relying on any information herein.

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