Staking on Solana: Everything you should know.

Staking is a fundamental part of Solana, as Proof-of-Stake is one of the two consensus mechanisms used by this blockchain. If you’re not very familiar with these terms and want to learn more about consensus mechanisms, I have an article here that explains it.
Through native staking, you delegate your SOL tokens to a validator. This validator will use the voting power granted by these SOL tokens (plus many others) to participate in the process of validating transactions, generating blocks, and making decisions. In turn, by participating in this process, validators earn rewards in SOL that they share with those who delegate their tokens to them.
Therefore, let’s see staking as a win-win: the network wins by becoming more decentralized, and you earn a reward for your contribution.

Liquid Staking Token.

Where was the problem? Perhaps it wasn’t exactly a problem, but native staking has certain peculiarities that make it less attractive. Mainly, when you delegate your tokens, you have to wait about 48 hours for the staking to become effective (and the same happens when you want to withdraw them). Additionally, your SOL tokens remain deposited there, and it’s capital that you can’t move; it only generates that % of earnings. As a solution to this limitation, LSTs (Liquid Staking Tokens) were born.
On this occasion, I will start differently from my usual articles and give my analogy of Liquid Staking Tokens.
I see the process as a “pawn”. Like when you have a financial emergency and you have something of value that you don’t necessarily want to sell but that can serve as collateral for a loan. This is how I would describe the liquid staking process so that anyone could understand it.
You have SOL, the native token of Solana, one of the fastest, most scalable, and cheapest blockchains (and if you ask me, the best). You want to do your part and help decentralize the network through staking, but at the same time, you don’t want to be left without capital to participate in DeFi protocols, so what do you do?
Simple, you perform liquid staking of SOL by handing over your tokens and receiving an LST that will allow you to participate in liquidity pools (to name one example) and that at the same time allows you to participate in the decentralization of the network and earn rewards for it; this is like a win-win-win.

Benefits of LSTs.

• Instant liquidity: Remember that feeling of having your SOL trapped in staking? With LSTs, you can keep your assets generating rewards and, at the same time, use them in other DeFi protocols such as loans, trading, or even more staking.
• Fewer risks, more peace of mind: LSTs protect you from market volatility and allow you to access your funds when you need them.
• Flexibility and tons of earnings: With LSTs, you can multiply your opportunities to generate profits. Stake your original SOL, use your LSTs in liquidity pools, lend your tokens, etc.

If you’re a Solana native, LSTs shouldn’t be new to you as they’ve been in the ecosystem for a while and are gaining more and more popularity. What’s interesting is that two days ago three major exchanges have hinted that they are about to launch their own LSTs on Solana. This is very important news for the ecosystem as it not only represents significant growth but is also proof that all eyes are on us.

Bybit with bbSOL.
Bitget with BGSOL.
Binance with BNSOL.

Conclusion: The future of Solana is liquid.

And that’s how Liquid Staking Tokens are revolutionizing the world of Solana! You no longer have to choose between supporting the network and making the most of your SOL.

And if we add to that the fact that giants like Binance, Bybit, and Bitget are entering the game with their own LSTs on Solana, the future looks brighter than ever! This not only demonstrates the enormous potential of Solana but also confirms that the whole world is watching closely.
So, if you haven’t tried LSTs yet, what are you waiting for?! It’s time to unleash the power of your SOL and join the liquid staking revolution!