Staking your crypto is great for earning rewards, but what if you didn’t have to lock your assets away to do it? Liquid Staking Derivatives (LSDs) offer the best of both worlds allowing you to earn staking rewards and stay liquid, meaning you can still use your crypto in DeFi strategies. Ready to make your crypto work double time?
What Are Liquid Staking Derivatives?
When you stake crypto like ETH, you typically lock your assets for a set period, making them inaccessible. With LSDs, however, platforms like Lido or Rocket Pool issue you a liquid token such as stETH for staked Ethereum that represents your staked asset. This token can be traded, lent, or used in DeFi, all while your staked ETH continues earning rewards.

Why Use LSDs?
- Stay Liquid: With LSDs, you get the best of both worlds staking rewards and the ability to use your assets. You can stake your ETH and use stETH to trade, lend, or provide liquidity.
- Double Your Yield: By using LSDs in DeFi platforms like Aave, you can stack your rewards earn staking rewards on your ETH and additional yield on your stETH by lending it or providing liquidity in pools.
- Access for Everyone: Traditional Ethereum staking requires 32 ETH, but LSD platforms like Lido let you stake any amount, making staking accessible to more users.
Real-Life Example: Maximize Returns with Lido and stETH
Imagine staking ETH with Lido. In return, you receive stETH, which you can lend on platforms like Aave to earn interest, or provide liquidity in Curve’s stETH-ETH pool to earn additional rewards from fees and incentives. This means you’re not just earning staking rewards you’re using your assets to boost your DeFi returns at the same time.

Risks to Keep in Mind
- Smart Contract Risks: Since LSDs rely on smart contracts, there’s always a risk of vulnerabilities or bugs. Stick to well-audited platforms like Lido and Rocket Pool for safety.
- Depegging: During periods of market volatility, the value of LSD tokens (like stETH) may briefly deviate from their underlying assets.
- Monitoring Required: Using LSDs in advanced DeFi strategies, like lending or leverage staking, often requires active monitoring to avoid risks like liquidation.
Conclusion: Make Your Crypto Work Harder
With Liquid Staking Derivatives, you no longer have to choose between staking and liquidity. You can earn rewards while keeping your assets flexible for other DeFi opportunities. Whether you’re staking large or small amounts, platforms like Lido and Rocket Pool make it easy to get started.
Ready to unlock more potential from your staked assets? Try LSDs today and watch your crypto earn while you stay liquid!