Table of Contents
BNB is the governance token of the BNB Chain ecosystem, playing a crucial role in securing the network. In addition, it offers a wide range of utilities in staking:
- Native On-Chain Staking: Users can earn 5%+ APY by staking BNB directly on-chain.
- MEV Solution: The recently launched MEV solution is expected to increase the staking APY by at least 5%-10%.
- Liquidity Staking: Users can join liquidity staking protocols to boost their APY by an additional 2% or more.
- Binance Launchpool and MegaDrop: These initiatives allow BNB holders to earn new tokens through their existing assets.
- Upcoming ReStaking and Liquid ReStaking: BNB Chain is actively developing these solutions to secure its infrastructure and add more value for BNB holders.
The ongoing BC Fusion will further enhance the BNB Chain, increasing its utility and governance capabilities. This will bring more utilities to BNB and make the user journey more effective and straightforward.
Current Staking Status
Ethereum boasts the strongest and most diverse staking ecosystem. However, compared to Ethereum’s staking ecosystem, BNB Chain has significant opportunities for growth in areas such as liquid staking, ReStaking, and Liquid ReStaking.
In the following section, we will delve deeper into the current status and potential of these opportunities.
| Ethereum（link） | BNB | ||||
| Projects | # of Staked ETH | % of Total Staked | Projects | % of Total Staked | |
| Liquid Staking | LiDo, Rocket Pool, etc | 10.6M | 32% | ListaDAO, Stader, pStake, Ankr | <2% |
| CEX Staking | Binance, Coinbase,Kraren | 8.1M | 24.8% | Binance | – |
| Staking Pool | Kiln, Figment, StakeFish, etc | 5.4M | 16.6% | Legend, BNB48, etc | – |
| Restaking | Eigenlayer | NA | NA | ||
| Liquid Restaking | Ether.fi, Renzo, Swell, etc | 2.5M | 8% | NA | NA |
| Solo Staking | Many Whales | 348K | 2.1% | Not too much | |
| Others | 5.4M | 16.5% | |||
| Total | 32.6M ETH | 100% |
Native on-chain Staking
In the past one year, the total on-chain staking is around 22M BNB, representing a staking rate of 15%. As of today, 28.6M BNB is staked across both BC and BSC. The blockchain is supported by 40 validators, who play a crucial role in maintaining the security and functionality of the network by validating transactions and producing new blocks. To further enhance decentralization, BNBChain is considering expanding the number of active validators from 40 to 50.
Source: Stakingrewards (2023.04.13~2024.04.13)
As a foundation, on-chain staking offers an average reward rate of 2.3%. Similar to ETH staking, BNB Chain supports various staking approaches, including solo staking, CEX staking, liquid staking, staking pools, and the future restaking ecosystem.
BNB Chain Fusion
The BNB Chain Fusion is a strategic shift to migrate the BC’s functionalities to BSC. This move aims to streamline the network, improve efficiency, reduce security risks, and align BNB Chain’s architecture with the current technological demands and future growth.
BNB Chain Fusion Timeline
According to the current timeline, BNB Chain Fusion is set to fully conclude by the end of July 2024. As of today, BSC native staking has surpassed 28M BNB, and all 21 cabinet validators are now on BSC, enabling automatic BSC native governance. The first BSC native governance proposal is forthcoming, and the community is encouraged to participate in this inaugural activity.
Post-Fusion, MEV rewards will be automatically distributed to validators and delegators, resulting in at least a 5-10% increase in APY. Additionally, staking rewards will be compounded daily, further boosting the APY. Many more opportunities will be introduced to BNB staking, so stay tuned for our upcoming content.
MEV Adoption
BNB Chain is enhancing the Maximal Extractable Value (MEV) landscape through the Proposer-Builder Separation (PBS) model to address existing challenges. As of today, three builders are live on the mainnet and integrated with 17% of the total validators.
The solution is in place, and the MEV supply chain is working in progress. Ideally, the MEV value chain will significantly increase the rewards for both validators and delegators. Based on the research from Eigenphi, 45% of the validator’s income comes from MEV.
Liquid Staking
Currently, the liquid staking ecosystem on BNB Chain is relatively limited compared to Ethereum, with around 310K+ BNB engaged in liquid staking protocols. This indicates a vast potential for growth in the liquid staking market. To build a robust LSDFi ecosystem, it is essential to leverage liquid staking, money markets, yield generation, and structured products, among other components.
ListaDAO, the largest liquid staking provider on BNBChain, has successfully migrated from BC to BSC and completed its smart contract upgrade [link]. They are now working on integration with other LSDFi protocols, which will bring more opportunities to the community. ListaDAO has also introduced ListaPie to boost yields and increase governance authority within ListaDAO. Stay tuned for their upcoming Lista Rush.
pStake and Stader are two other strong players in BNB Chain liquid staking. Stader Labs, the team behind Stader Liquid Staking and KelpDAO, has supported BNB Chain liquid staking from the beginning. pStake, an early adopter in the BNB Chain liquid staking space, is now expanding its services to include BTC liquid staking.
Top money markets such as Venus, AAVE, and Kinza have already integrated with liquid staking BNB or are in the process of doing so. This integration is expected to increase the APY(up to 2.5% now) and the utility of stBNB significantly.
Furthermore, yield aggregators and bribery providers are actively working to support BNB Chain liquid staking. Magpie and Lista have partnered to build a SubDAO, ListaPie, to ensure governance and benefits for the community. Pendle is also working on integrating with SlisBNB.
Later this year, liquid staking BNB will be incorporated into derivatives, stablecoins, and structured products. The LSDFi ecosystem is on its way to flourishing.
Additional CEX Staking and Airdrop
In addition to on-chain staking, Binance Exchange offers numerous staking and earning opportunities to help users maximize their rewards. Binance Launchpool and MegaDrop serve as platforms for airdrops to end users, aiming to bridge projects and users while creating mutual benefits. Since 2024, 13 projects have been launched through Binance Launchpool, equating to an annual percentage yield (APY) of over 150%.
The Rise of Liquid Staking and Restaking
As we can see Ethereum’s staking ecosystem(32M ETH staked) is rapidly evolving, with liquid staking offering immediate benefits by providing liquidity. Restaking and liquid restaking build on this by maximizing the earning potential through multiple layers of staking. BNB Chain has also recognized the significant opportunities in this direction. BNB Chain is well-prepared at the staking layer, and BC Fusion will simplify the process further.
Restaking and liquid restaking are emerging trends in the Ethereum ecosystem, contributing $34 billion to its growth. Beyond their financial impacts, restaking and it’s associated infrastructures will enhance the ecosystem’s security.
Liquid resteaking derivatives(LRTFi) represent another crucial area for improving the utility of BNB and stBNB. By bolstering security and earning rewards from other networks like Oracles, Bridges, Layer 2 solutions, and Data Availability layers, LRTFi can become essential infrastructure for future permissionless modular blockchains.
Similar to LSDFi, BNB Chain needs to incubate a comprehensive LRTFi ecosystem, which is expected to be ready in Q3 this year.
Close Thoughts
BNB staking is the first-ever service that brings CeDeFi benefits to the community. Staking with BNB not only provides financial incentives but also enables users to participate in the governance of the blockchain network actively. With BC Fusion and other upcoming advancements, the potential for staking BNB is greater than ever, making it an appealing option for those looking to maximize their returns and contribute to the future of blockchain technology.
The surge in BNB liquid staking – now at 300K BNB staked on-chain, highlights the vast potential to expand the market and benefits further. This growth positions BNB staking to become increasingly compatible with Ethereum staking, offering even more opportunities for community.
Reference
https://blog.superteam.fun/p/state-of-solana-defi-2024
https://www.geckoterminal.com/solana/orca/pools
https://blog.syndica.io/deep-dive-solana-defi/
https://insights.glassnode.com/the-week-onchain-week-16-2024/
https://everstake.one/crypto-reports/ethereum-staking-report-2023
