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Evaluation of major LSD solutions: Lido, Frax, and Rocket Pool

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The liquid collateral derivatives wars are heating up.

原文标题：《 The Liquid Staking Wars Are Just Getting Started 》

Kodi

Deep Tide TechFlow

历经一年多的下跌，我们终于获得了 Token 的暴涨。而且，你可能已经注意到，Lido (LDO) 和 Rocket Pool (RPL) 等一些表现最好的 Token 都与 Liquid Staking Derivatives (LSD) 有关。

What exactly is LSD? Does this narrative make sense?

LSD is a way for Ethereum (ETH) pledges to eat their cake.

现在以太坊是一个权益证明 (PoS) 链，你可以质押你的 ETH，获得约 4-6% 的舒适、稳定的收益。可悲的是，质押的 Token 不能在其他地方使用。

我知道，这种个位数的 APY 有点无聊，但是，不要担心，LSD 允许你将 ETH 放入智能合约中，并收到该质押 ETH 的 Token 化衍生品作为回报。

Will the LSD narrative endure?

Our view is that it will.

这是因为尽管以太坊占据主导地位，但质押 ETH 仍被视为风险，因为用户目前无法撤回质押的 Token 。

Do you know what the typical pledge ratio of a PoS chain is? Somewhere between 40-70%, depending on Staking Rewards. Taifang's pledge is a paltry 13 per cent.

正如 Ben 在「Musical Chairs」中指出的那样，在即将于 3 月进行的上海升级后，这个数字可能会增加，这将允许用户提取他们所质押的 ETH。这将降低 ETH 质押的风险，并且随着越来越多的 Token 被质押，从而将推动对 LSD 的需求。

In April 2021, LSD began to outpace other pledge solutions. By the time Ethereum successfully switched from PoW to PoS (merger) in September 2022, they were already at the top of the food chain.

I've (hopefully) convinced you that LSD is a story that won't go away, so let's get down to business and examine some of the most popular liquidity pledge solutions.

competitor

没错，这里毕竟是加密货币。LSD 的解决方案是 dApps，你总是可以指望 dApps 发行治理 Token 来进一步去中心化，赋予社区权力。

This gives us the opportunity to bet directly on the growth and hype of LSD. According to DefiLlama, the leading LSD protocols are as follows:

由于我们只关注具有治理 Token 的协议，所以我们将不讨论 Coinbase。虽然 Stakewise 已经取得了一些早期的成功，但它的采用已经停滞不前，所以我们今天将其排除在我们的讨论之外。

As a result, we believe the three protocols that benefit most from LSD's narrative are Lido, RocketPool, and Frax.

Lido (LDO)

The spigot of LSD is Lido. In the LSD protocol, up to 30% of pledged ETH and more than 70% of ETH are located in Lido.

The Lido is set up as a decentralized autonomous organization (DAO), and the LDO is the DAO's "membership card."

LDO holders can vote on aspects related to the operation of the Lido, such as the fees the DAO should receive, or what node operators and prognosticators the Lido uses. Daos also accumulate profits, which are allocated to research and development, liquidity incentives, and so on.

然而，LDO 并没有给 Token 持有者累积任何价值。因此，这更像是对 LSD 成功和 Lido 继续占据主导地位的投机性押注。

并不是说这有什么不对。有时，仅依赖叙述的 Token 是最好的选择。

可以说，2021 年牛市中表现最好的行业是 Meme 币。而 Uniswap 的 UNI，其结构与 LDO 类似，是表现最好的 DeFi Token 之一。在加密货币市场成熟之前，meme 和叙事是王道。我们最好不要忘记这一点。

然而，如果你想从你持有的 Token 的 DApp 中获得一份利润，你将不得不去寻找别的地方。

Go to Frax, for example.

Frax (FXS)

At least when it comes to LSD, Frax is a newcomer. But its growth has been phenomenal, becoming the fifth largest LSD solution per ETH in just three months. That's even more impressive given that we're in the middle of a bear market.

One of the reasons for Frax's rapid success with LSD is that it has implemented a number of DeFi products, including stablecoins, lending markets, and decentralized trading platforms. In addition, it has used its influence over Curve to provide its users with substantial ETH benefits.

So how does Frax's governance Token FXS work?

Frax implemented a veToken model with FXS that is similar to Curve's model.

Frax Token 持有者可以锁定他们的 FXS 以换取 veFXS：他们持有的时间越长，得到的 veFXS 就越多。你拥有的 veFXS 越多，你的收益率提升、投票权和利润份额就越高。

At the time of writing, the current APR is 1.58% if you lock in your FXS for four years. It's not great, but it's better than nothing. And it's entirely profit based and sustainable, which is very rare among cryptocurrencies.

LSD is just one of their products, and (yet) not their core product. So FXS isn't a pure bet on LSD's success, but because Frax's offerings are so intertwined, if one fails, the others are likely to fail, too.

In other words, the success of the agreement will depend on LSD.

Rocket Pool (RPL)

Launched in November 2021, Rocket Pool positions itself as an LSD solution for the masses, as opposed to venture-backed Lido. Whether or not that description holds true, the reality is that Rocket Pool has indeed managed to capture more than 5% of the market.

We won't get into the details of Rocket Pool's pledge mechanism. The most important thing for us right now is:

Rocket Pool node operators are rewarded in ETH (from mortgage yield) and RPL (from Rocket Pool Inflation). The node operator must provide the collateral along with its ETH. This collateral can act as insurance if the node operator is cut back.

Guess what the collateral is in?

That's right, RPL. The more RPL you issue as collateral, the higher the RPL award you receive.

In order to prevent the RPL Whale from receiving most of the rewards, the maximum amount of collateral you can provide is equal to 150% of the value of the ETH pledged by the user. But there is also a 10% minimum collateral to receive any RPL award. These serve as the soft upper and lower limits of RPL prices relative to ETH.

If the value of the RPL increases too much, the node operators will take collateral out of their coffers because they are not rewarded beyond the 150% cap. There wasn't much they could do with RPL at the time, other than sell it.

However, if the price of RPL drops too much, node operators will need to buy and issue more RPL as collateral in order to continue receiving the rewards of RPL.

实际上，该模型刺激了对基于 ETH 质押活动的 RPL 的需求，将 Token 的成功与其质押解决方案的成功联系起来。

choose

那么哪种 LSD 治理 Token 最有潜力呢？

If you want to play it safe, the answer is simple: LDO.

Lido is way ahead in the field of LSD. More importantly, it wins the narrative.

When you think of LSD, the first protocol that comes to mind is Lido. This is also the first choice for most people to pledge ETH. Lido's stETH is synonymous with pledged ETH.

但是 Token 不累积任何价值。

So what?

如果 DOGE 能突破 1 美元，那么无用的治理 Token 也能让你发财。

如果你想玩得更冒险一点，FXS 是你应该关注的 Token 。

请注意，不是为了价值累积。用低的个位数 APY 来换取将我的 Token 锁定 4 年？我认为我不会这么做。FXS 现在是一个很好的选择，因为它的增长速度惊人。

Betting on Frax, however, means betting on all of its DeFi divisions, with no guarantee of their success. So it's a riskier but potentially more lucrative bet.

Rocket Pool has been largely successful. However, RPL is not an attractive bet at the moment. Rocket Pool is nowhere near catching up to Lido, and it's not growing as fast anymore.

If that changes, we will change our view.

总的来说，很明显的是，一个协议的成功和它的 Token 并不像人们想象的那样交织在一起。成功的协议可能是糟糕的投资。反之亦然，尽管更为罕见。

In any case, the LSD wars are heating up, and teams across DeFi are coming up with more innovative solutions. We expect the Shanghai upgrade will only generate more buzz when ETH pledge becomes more attractive.