A Guide to Liquid Staking Tokens
Too Long; Didn't Read
Liquid staking tokens (LSTs) are a new development in the cryptocurrency space that allow investors to earn yields on their staked assets while retaining liquidity. LSTs can be traded on DeFi projects and transferred to other users. Benefits of LSTs include earning passive income while maintaining flexibility and enabling composable yield strategies. However, there are risks such as de-pegging, smart contract vulnerabilities, and centralization. Several projects are competing in the LST market, and platforms like Sturdy are making it easier to incentivize liquidity and earn higher yields. By carefully evaluating projects and platforms, investors can take advantage of LST benefits while mitigating risks.