The liquid staking sector on Solana is currently experiencing a surge in activity, as indicated by a 1.76% increase in the liquid staking ratio over the last quarter. The number of Liquid Staking Tokens (LSTs) has notably doubled, and the market landscape is becoming more diverse, with the dominance of the top three providers decreasing from 93% to 68.7%.
One of the key catalysts for this growth is the airdrop from Jito Labs, which has brought attention to liquid staking on Solana. This airdrop alone has led to a 2% increase in the liquid staking ratio from Q4 2023 to Q1 2024. Additionally, the introduction of new technologies and incentives by Sanctum, such as the launch of INF, Sanctum Router, and Sanctum Reserve, has further propelled this growth.
The doubling of LSTs on Solana is a significant milestone for the ecosystem, with the current count reaching 53. Although this is still in the early stages compared to the vision of having thousands of LSTs, it signifies the expansion of the ecosystem and its potential for further growth.
Previously, Solana’s liquid staking sector was dominated by a few key players, similar to Ethereum’s landscape where Lido holds a 70% market share. However, with Sanctum’s innovations and the emergence of new high-quality projects from entities like Helius Labs, Solana Compass, Jupiter Exchange, and Drift Protocol, the market landscape is shifting. These new entrants are challenging the existing hierarchy and contributing to a more diversified and healthy market.
Jupiter Exchange, with its jupSOL token, has made a notable impact among the new entrants. It has surpassed bSOL in market capitalization, with a total value locked (TVL) of $329 million and has experienced a 22% growth in the past 30 days. This growth can be attributed, in part, to its integration with Kamino Finance, where jupSOL has become the most deposited LST, holding $220 million, and offers the highest annual percentage yield (APY) of 21%.
