The narrator explains that yield farming involves depositing crypto assets into decentralized finance (DeFi) protocols like Uniswap or Aave to earn rewards from fees or interest.
Staking, on the other hand, means locking up crypto to participate in a blockchain's security in exchange for rewards.
While both yield income, key differences include:
"Staking" is also an ambiguous term used to mean different things.
Here is a condensed summary of the main points from the text:
Liquid staking allows you to stake your Solana while still having it available to use and move around. The top 3 liquid staking options on Solana are Marinade Finance, Jeto Soul, and Soulblaze.
Marinade Finance offers 7% APY with no current incentives after their recent 3-month rewards program ended. However, they may start a new incentive program soon.
Jeto Soul also offers 7% plus additional yield from arbitrage. They recently airdropped their governance token but currently there is not much activity happening with it.
Soulblaze offers the highest base APY at 8% plus additional token rewards for using their liquidity pools. They are distributing Blaze tokens over time to holders which can then vote on platform emissions. Soulblaze seems to have the most opportunities for added incentives.
The narrator suggests diversifying across all 3 liquid staking options as there may be future airdrops or incentives offered. But Soulblaze is currently his favorite for the highest yield.
Here is a condensed summary of the main points from the text:
The narrator explains the concept of liquid staking in decentralized finance (DeFi). When you stake tokens in DeFi, your tokens are locked up and can't be used while earning yield. Liquid staking allows you to stake your tokens and receive a receipt token that represents your staked assets. This receipt token can be used elsewhere to earn additional yield.
The narrator provides three examples of protocols offering liquid staking:
The narrator explains how liquid staking allows users to earn yield on staked assets while also using the receipt token to earn additional yield elsewhere. This demonstrates the power of DeFi composability.
The narrator explains the concept of "restaking", which allows Ethereum stakers to earn additional yields by securing other protocols. EigenLayer provides the infrastructure for restaking.
Restaking works by pooling the security of Ethereum's $13 billion in staked ether and allowing new protocols to tap into it. This makes launching new protocols more capital efficient. EigenLayer has created an open marketplace where protocols bid for the favor of Ethereum validators by offering rewards and incentives.
For stakers, restaking opens up opportunities to earn more returns in addition to their staking yields. Some concerns have been raised about overexposing validators and jeopardizing Ethereum's security, but restaking is still seen as beneficial in low risk scenarios.
Other protocols like Puffer Finance, Tenet, and ASD Finance are already utilizing restaking. Overall it has the potential to drive more liquidity into Ethereum staking and increase its staked ratio compared to other chains.
Lido has too much control over the Ethereum network, concerning the narrator. So the narrator provides four alternative liquid staking options:
Rocket Pool has low minimum deposit (.01 ETH), slashing protection, and many wallet integrations. It offers 3.38% APR.
Stader offers 3.8% APR and has a $1 million bug bounty program. It also has lots of wallet integration options.
StakeWise takes a 10% commission like Lido. It offers 3.7% APR and has a $200,000 bug bounty program.
For running your own validator, the narrator recommends Blocks Staking. It is non-custodial so removes third-party risk.
The narrator hopes liquid staking design flaws get addressed given weaknesses seen with Lido. The narrator recommends spreading out delegation across platforms.