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Solana Liquid Staking Protocols up 91%: Can DeFi Defy SEC’s Attack on SOL?

Published July 4, 2023 2:33 PM
Teuta Franjkovic
Published July 4, 2023 2:33 PM
Key Takeaways
  • Including Marinade, Lido, and Jito, the TVL in Solana’s liquid staking protocols has increased by 91% so far this year
  • Around 1.66 million SOL, equating to $31 million, has been deposited into LSD protocols
  • With a 62% market share, Marinade Finance dominates the liquid staking market on Solana, followed by Lido with a 27% market share

The value of assets staked into liquid staking protocols has increased in the Solana ecosystem, representing a 91% increase year to date.

Estimated $270 Million in TVL

At the end of June, a variety of liquid staking protocols, including Marinade Finance, Lido, Jito, JPool, and Socean, had collectively held $187 million in staked Solana (SOL) tokens. From the initial $98 million staked at the beginning of the year, this indicates a significant increase. Currently, these protocols account for 69% of the estimated $270 million in total value locked within the network.

According to Kevin Peng, a research analyst, the significant growth observed in this market segment throughout the larger crypto space may be the cause of the increase in investment into Liquid Staking Derivatives (LSDs) inside the Solana ecosystem. In particular, the increase in liquid staking on Ethereum after the Shapella upgrade may have sparked a cascade effect that spread to Solana.

“Overall, LSDs have grown as a category across crypto in 2023 in large part due to the new dynamics around staking on Ethereum, though demand for these products has trickled into the Solana ecosystem as well,” said Peng.

About 1.66 million SOL, or $31 million, have been placed into LSD protocols this year, demonstrating that increasing inflows are partially to blame for the rise in liquid staking TVL.

The price of SOL, the native token of Solana, has increased by roughly 60%, which is another important component driving this movement. The value of SOL deposits in liquid staking has increased as a result of this price increase.

Liquid Staking In Solana With Marinade As a Leader

According to research, Marinade Finance continues to rule as the top liquid staking project inside the Solana ecosystem , holding a commanding 62% market share and housing about $120 million in total value locked (TVL).

Despite being the largest liquid staking mechanism in the Ethereum ecosystem, Lido Finance only claims a 27% market share in Solana’s territory.

Due to its dedication to decentralization and support for excellent validators, Marinade Finance stands out as a notable liquid staking platform on Solana. Because of its active participation in the ecosystem and promotion of a thriving community, Marinade has gained popularity among many cryptocurrency users.

For individuals wishing to participate in liquid staking on Solana, Marinade is a desirable alternative due to its wide variety of DeFi integrations. Marinade enables users to make the most of their staked assets by providing seamless integration with other DeFi platforms, enhancing potential rewards and opportunities in the Solana ecosystem.

Additionally, Jito Labs, which runs client software on the Solana network, has made progress with liquid staking. Using its staking solution, the project has increased its share in liquid staking from 1.9% to 6.9% year-to-date.

Can the DeFi Rise Help Solana’s Battle Vs. SEC?

Stablecoins and decentralized finance (DeFi) may be on the Securities and Exchange Commission’s (SEC) radar.

Investment bank Berenberg recently stated in research that such a move is “likely” in light of the regulator’s recent enforcement measures targeting participants in the cryptocurrency business.

“We have concluded that the SEC may now focus its actions on bringing stablecoins, including both USD Coin (USDC) and Tether (USDT), and DeFi protocols into regulatory compliance,” Berenberg said in the report after looking at recent public statements and lawsuits filed by the SEC and other regulators.

DeFi Education Fund, a crypto lobbying group, recently claimed in a letter to the SEC  on June 12 that the proposed modifications would ultimately lead to a “de-facto banishment of DeFi from the U.S.”

The group wrote:

“The Proposal represents a slapdash and legally troublesome attempt to shoehorn the novel technologies in the crypto asset and DeFi spaces into antiquated and ill-fitting regulatory regimes.”

Advocates and lobbyists contend that the industry need a comprehensive set of new regulations since it cannot be governed by the frameworks currently in place for stock exchanges.

The sector asserts that the SEC’s attempt to lump DeFi in with other centralized exchanges amounts to a flagrant misuse of its legal authority.

Be it as it may, it is hard to conclude whether this DeFi growth could be good enough for Solana to beat SEC in its unrealistic demands. However, there are plenty of benefits of DeFi for investors who could, after all, become the main characters in this fight.


In the field of decentralized finance (DeFi), liquid staking has emerged as a ground-breaking invention that enables cryptocurrency owners to maximize the value of their digital assets. Solana is gaining popularity and is positioned to play a big role in the development of DeFi, which could lead to a positive outcome in Solana Vs. SEC war.