dYdX Chain Upgrades to Support Liquid Staking Protocols

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The dYdX Foundation has announced the integration of liquid staking on its blockchain, starting with a collaboration with Stride, a leading liquid staking provider in the Cosmos Ecosystem. This move marks a pivotal step in expanding the utility and accessibility of the dYdX chain.

Launch with Stride and Expansion Plans

The initial launch of liquid staking on the dYdX chain is in partnership with Stride, renowned for its prominence in the Cosmos Ecosystem. Stride’s involvement is expected to enhance the efficiency and appeal of staking on the dYdX chain.

The dYdX Foundation has also disclosed plans to incorporate other prominent liquid staking solutions, such as Persistence and Quicksilver, in the coming weeks. This expansion underscores the Foundation’s commitment to diversifying staking options and enhancing user experience on its platform.

Liquid staking, a process where users lock up tokens in return for a token receipt that can be traded or utilized in various DeFi applications, has seen immense popularity in the cryptocurrency industry. Integrating this service on the dYdX chain strategically aligns with industry trends and user preferences.

Understanding Liquid Staking on dYdX

With the launch of liquid staking on the dYdX platform, token holders now have the opportunity to purchase staked denominations of the platform’s native token, DYDX. This initiative allows users to contribute to the security of the dYdX v4 chain and earn additional yield in the form of USDC through trading and transaction fees.

Stride co-founder Riley Edmunds highlighted the significance of this development, noting that the non-inflationary yield of stDYDX makes it a stable source of collateral with various DeFi use cases within the Cosmos ecosystem. This attribute of stDYDX is expected to boost its adoption and utility across different DeFi platforms.

Impact on the DeFi Landscape

The integration of liquid staking on the dYdX chain is poised to impact the DeFi landscape substantially. According to data from DeFiLlama, liquid staking derivatives currently possess a total value locked (TVL) of over $31.1 billion, indicating the high demand and popularity of these services in the DeFi sector. The dYdX chain’s adoption of liquid staking will likely contribute significantly to this trend, offering users more flexibility and opportunities in their staking activities.

This development is not just a boon for users seeking diversified yield-generating opportunities but also for the overall health and security of the dYdX network. By incentivizing token holders to participate in network security through attractive yield offerings, the dYdX Foundation is ensuring a more robust and decentralized ecosystem.

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The post dYdX Chain Upgrades to Support Liquid Staking Protocols appeared first on CoinGape.

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