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stCORE - Liquid Staking on Core

Core Blockchain offers several innovative solutions like Non-Custodial Bitcoin Staking, coreBTC, and Liquid staking in the form of stCORE for users to make the most of their CORE holdings. Liquid staking is a mechanism that allows CORE holders to earn Core Consensus rewards while maintaining the liquidity of their assets.

What is Liquidity Staking?​

Staking CORE helps secure the network but prevents token holders from participating in different DeFi protocols as their tokens cannot be used for other purposes while staked. Minting a new Liquidity Staking Token (stCORE) unlocks a world of possibilities, allowing token holders to utilize their tokens in different interactions while continuing to earn the staking rewards. Essentially, liquid staking unlocks liquidity for staked tokens, building upon existing staking systems.

Primary Purpose of stCORE​

The primary purposes of introducing liquid staking via stCORE on Core are:

  • Improve user experience
  • Bring more utilities of CORE token

For the moment users can stake CORE tokens to individual validators directly through https://stake.coredao.org. However, there are two drawbacks raised by the community

  • There is no auto-compounding feature, and users need to claim rewards and restake them to validators manually everyday.
  • The hash stakes from Bitcoin mining pools are less fungible and not as stable as CORE stakes, which causes affected validators’ APR to change more dramatically.

On the other hand, we are also seeking ways to add more utilities to the CORE token itself. By introducing stCORE, we expect the CORE token itself to also benefit. E.g. to provide CORE/stCORE liquidity pairs in decentralized exchanges.

Steps involved in Liquid Staking on Core​

  1. Staking Setup: To participate in Core liquid staking, users need to convert their CORE holdings into a staked CORE (stCORE) format. This involves locking up a certain amount of CORE and depositing it into the stCORE staking contract, which will automatically delegate the CORE to selected validators on the chain.

  2. Issuance of stCORE: In return for staking CORE, users receive liquid staking tokens,, i.e., stCORE. These tokens represent their staked CORE holdings and can be freely traded or transferred while still earning staking rewards.

  3. Staking Rewards: Users can earn annualized return on holding stCORE which is the projected yearly increase in its conversion ratio with CORE. This means that users can exchange for more CORE when they burn their stCORE.

Benefits of Liquid Staking on Core​

  1. Liquidity: One of the major advantages of liquid staking on Core is that it allows users to maintain the liquidity of their CORE holdings. Unlike the traditional staking mechanisms offered by other platforms, where funds are locked for a specific period, Core liquid staking provides flexibility by enabling users to trade or transfer stCORE tokens without waiting for the staking period to end. In the CORE staking model, anyone can unstake their CORE anytime, so they don't really have to wait for staking period to end. Our CORE staking model is "stake & earn", "unstake & stop earning". So it's locked if you want the earning.

  2. Earning Potential: Core liquid staking allows users to earn rewards on their staked CORE while still participating in the broader Core ecosystem. This presents an opportunity to benefit from both staking rewards and potential price appreciation of Core.

Conclusion​

Liquid staking on Core in the form of stCore provides an innovative and impressive option for CORE holders to maximize their returns while maintaining the liquidity of their assets. By following the necessary steps and being mindful of the associated risks, users can benefit from staking rewards while actively participating in the Core ecosystem. As the Core network evolves and improves with the each upgrade, Core liquid staking is likely to become an increasingly popular choice for CORE holders seeking to optimize their investment strategies.