Liquid Staking Definition | CoinMarketCap

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Liquid Staking Definition | CoinMarketCap
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CMCGlossary: Liquid Staking ✨ Liquid staking should not be confused with regular staking. It offers various unique benefits. 👉 Details: CMCEncyclopedia ComingSoon

blockchains, allowing users to maximize the benefits of staking and DeFi simultaneously. Furthermore, liquid staking enhances network security on PoS chains.Liquid staking should not be confused with regular staking. It offers various unique benefits.Liquid staking allows DeFi protocols and blockchains to do more with the same amount of capital. With regular staking, each dollar staked is one dollar that cannot be used in a DeFi protocol, thus reducing its liquidity and utility.

Another potential risk is a divergence between the collateral value and the value of the wrapped token. This happened when . However, such diversions are only temporary and the market returns to the equilibrium price after volatility subsides.

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