What is liquid staking?
Crypto liquid staking is a relatively new concept that combines the benefits of staking and liquidity in the cryptocurrency market. Staking refers to the act of holding and locking up a certain amount of cryptocurrency in a blockchain network to support its operations and earn rewards in return. This process typically involves a period of time during which the staked tokens are inaccessible or illiquid. In the case of GRT, the thaw period is 28 epochs (roughly 28 days). Utilizing Tenderize, you can avoid some of the down-time where you do not earn GRT rewards during the undelegation thaw. It is also useful if you’d like the ability to switch indexers immediately.
Liquid staking aims to provide liquidity to staked assets by allowing users to receive tradable tokens, commonly known as “liquid tokens” or in the case of Tenderize “tGRT” in exchange for their staked native GRT. These liquid tokens represent the underlying staked assets while also being tradable and accessible on various decentralized exchanges (DEXs) or platforms. This method is similar to the larger ETH LSD providers like LIDO (stETH) or Rocketpool (rETH). The benefit of Tenderize’s updated version is you will be able to choose your indexer, rather than just put your GRT into a pool and get the average rewards of the indexing pool, shared with all staking participants.
Additionally, the tGRT tokens obtained through liquid staking on Tenderize can be used as collateral for borrowing or lending purposes. This feature enables users to access liquidity without the need to unstake their GRT tokens. By utilizing tGRT as collateral, stakers can leverage their staked assets while still earning staking rewards. You can earn interest on top of your interest with your tGRT within Defi. Tenderize plans to have a borrow feature in which you can take a loan against your stake with stable coins at a fixed rate. More details on this are pending, so keep eye out for twitter updates.
It’s important to note that it is advisable that you explore the platform’s documentation and guidelines to fully understand how liquid staking with tGRT works, and its potential benefits, while understanding the risks.
What is Tenderize?
Founded in December 2021 by Nico Vergauwen, Tenderize is a liquid staking protocol where users can stake cryptocurrencies to receive staking rewards without locking their deposit or actively managing their investment. Check out their docs — here
Tenderize focuses on offering liquid staking solutions for Web3 “work protocols”. Work protocols are decentralized networks that require node operators to compete to perform computational work (e.g. storage, rendering, ..) through their stake. In return for doing so, they earn network fees and rewards.
With Tenderize, users can earn compounding staking rewards, swap tenderTokens for the underlying asset, and earn liquidity farming rewards. When users stake their crypto assets on Tenderize, they get tenderToken, a 1:1 ERC-20 derivative of the underlying deposit. These tenderTokens can be freely traded on decentralized exchanges or used in DeFi apps. Users get more tenderTokens as their deposit starts accruing staking rewards. Tenderize currently accepts MATIC, GRT, LPT, and AUDIO deposits and crossed 1M+ in total value locked — see Defi Llama
TenderTokens unleash the composability between DeFi and staked assets, allowing you to earn yield on top of yield. TenderTokens provide a new financial primitive that unlocks a wide array of new use cases for your staked web3 tokens.
Members:
Alec Shaw- CEO
Nico Vergauwen — Founder
Salim Hadri— COO
Nigel Gauthier — Head of Content