How to maximize your BNB yields with pSTAKE?

pSTAKE is a multi-chain liquid staking protocol that unlocks the liquidity of PoS assets by issuing staked representative tokens against users' bonded assets, allowing them to earn DeFi yields on top of the staking rewards. pSTAKE provides the most seamless staking and yield generation experience for the BNB holders.

Developed by Persistence, pSTAKE is a multi-chain liquid staking protocol that unlocks the liquidity of PoS assets by issuing staked representative tokens against users' bonded assets, allowing them to earn DeFi yields on top of staking rewards. 

pSTAKE's liquid staking solution is live on four chains: BNB Chain, Cosmos, Ethereum, and Persistence. Additionally, pSTAKE is in the process of developing liquid staking solutions for other leading PoS networks.

Why does liquid staking present the next phase of growth for the BNB ecosystem?

BNB Chain has a BNB staking ratio of ~11.7%. The staking ratio reflects the bonded 18.9+ million BNB of the ~161 million circulating supply.

While these numbers show promise in terms of staked value, the network would greatly benefit from having a higher staking ratio to ensure more decentralization and security.

One of the core reasons for the low staking ratio is the usage of BNB tokens in the extensive DeFi offered on the network. Since BNB is the network's native token, it boasts tremendous utility across the various dApps. High DeFi yields against 5% staking rewards make the users' choice very obvious.

The booming DeFi ecosystem on the PoS networks needs liquid staking. Traditional staking limits the yield opportunities for the users and presents user experience challenges. A few limitations:

  • Users can stake 1 BNB or more. At current prices, 1 BNB can be a considerable amount for many users. 
  • Illiquidity of staked assets
  • Long unbonding periods
  • The opportunity cost for DeFi yields

That's where pSTAKE's liquid staking solution comes into play. With stkBNB, the user would receive instant liquidity (which can be used elsewhere, for example, in DeFi to generate additional yield) while still earning staking rewards on their staked assets. Simply put, the promise of liquid staking would incentivize more token holders to stake their BNB. 

What are the main differences between pSTAKE's BNB liquid staking solution and traditional staking?

Here are some of the differentiating factors:

  • Zero staking barrier: Staking directly on the native chain requires a minimum of 1 BNB. However, with pSTAKE, this barrier is removed. Users can stake any non-zero amount of BNB on pSTAKE. The underlying staked BNB is then delegated to a trusted set of secure, high-yield generating validators to optimize user rewards.
  • Instant liquidity & Flexibility: When unstaking their BNB, users must wait for the 7-day unbonding period before the asset becomes liquid and ready to use. However, by staking their BNB via pSTAKE, users receive instant liquidity on their staking position in the form of stkBNB. pSTAKE's stkBNB will have pools with BNB and other assets in the future, making it easy for users to swap their stkBNB for BNB at any time, thus bypassing the unbonding period and providing unparalleled flexibility.
  • DeFi Opportunities & Higher Yield: With stkBNB, users can earn higher yields generated across integrated BNB Chain DeFi applications and staking rewards versus only receiving one passive income stream from traditional staking.
  • Auto-Compounding: With on-chain staking, rewards compounding isn't available until the total accumulated rewards earned exceeds 1 BNB (i.e., the minimum stake amount). However, pSTAKE allows users to automatically compound their staking yields so that users continue to maximize their capital efficiency entirely and seamlessly.

How does pSTAKE's liquid staking solution work?

pSTAKE's BNB liquid staking solution will allow users to stake any non-zero amount of BNB. The user will be instantly issued stkBNB, which follows an exchange rate model (inspired by Compound's cToken model), and the native BNB token is staked on-chain. 

The value of the user's stkBNB will keep increasing against BNB as it accrues staking rewards in the background. The protocol has even gone one step further to enable auto-compounding on the user's BNB staking rewards to allow them to generate the highest yields.

When a user performs an unstake transaction on the pSTAKE application, the stkBNB deposited by the user is burnt. The protocol creates a claim request for an equivalent amount of BNB based on the ongoing exchange rate (c-value) against the user's wallet. 

Users can then claim the unstaked BNB from the pSTAKE application after 15 days (this allows the protocol to safely undelegate funds from validators). The user will stop earning rewards after performing the unstake transaction. Alternatively, users can skip the waiting period by swapping their stkBNB for BNB directly from the liquidity pools on DEXs such as PancakeSwap.

Read the full implementation Here and Watch the Video-Tutorial to stake BNB via pSTAKE!

How do users leverage their stkBNB?

The pSTAKE team's primary goal is to create high utility for stkBNB, and towards the same goal, stkBNB is already integrated with multiple leading applications within the BNB ecosystem. Some of them: 

  • PancakeSwap: Two separate liquidity pools launched for stkBNB/BNB and PSTAKE/BUSD, where users can trade token pairs and provide liquidity to earn LP tokens. Users who stake LP tokens will receive CAKE as a reward. Watch the Video-Tutorial Here!
  • Alpaca Finance: Users can leverage farm the stkBNB/BNB and PSTAKE/BUSD pools on Pancakeswap by depositing and borrowing assets. ALPACA stakers will also be able to receive PSTAKE rewards through pools within its Grazing Range. Watch the Video-Tutorial Here!
  • Open Leverage: Through Open Leverage’s margin trading market that integrates with PancakeSwap’s stkBNB/BNB pool, traders can use their stkBNB as collateral to borrow BNB, which can then be used to open leveraged staking positions.
  • Beefy Finance: Users can deposit their BNB on Beefy Finance where 50% is instantly converted into stkBNB, which is then used to provide liquidity to PancakeSwap stkBNB/BNB farm. The protocol automatically sells earned rewards and reinvests them into the same pool to auto-compound. Watch the Video-Tutorial Here!
  • Other Integrations: Other potential integrations include Venus Protocol (Money Market for stkBNB) and Wombat Exchange (BNB & stkBNB swaps via sidepools).

What does the future hold for pSTAKE and stkBNB?

pSTAKE is committed to constantly bringing liquid staking innovation to popular PoS chains and DeFi ecosystems. pSTAKE is leading the charge and already beginning to gain traction. The rise in pSTAKE's adoption is a testament to the demand from stakers to unlock additional yield in DeFi.

We plan to emphasize BNB Chain significantly and aim to become the #1 liquid staking protocol within the ecosystem. To this end, we will focus on educating BNB holders about staking and liquid staking. 

Additionally, by coupling closely with the vast DeFi ecosystem on the BNB Chain, we strive to make stkBNB the default asset of the BNB ecosystem and add value to the ecosystem by increasing its ratio and hence higher chain security.

As PoS economies rely on a high staking ratio to remain secure as TVL grows, liquid-staked assets will naturally become the default assets in the PoS space. pSTAKE's broader vision is to become a one-stop shop for users to stake and find DeFi opportunities across top-tier ecosystems.

To earn additional yields on BNB explore this!

Get Involved with pSTAKE!

- Stake BNB via pSTAKE: bnb.pstake.finance  
- Learn more about stkBNB
- Join pSTAKE CMC Community
- Follow pSTAKE on Twitter for all the latest updates