StaFi recently launched its decentralized exchange (rDEX) to improve the ease of trading the rTokens. In the past, users had to shop around for DEXs with adequate liquidity to trade issued rTokens. However, that has changed following the creation of the rDEX.
With the launch of the rDEX, the DeFi protocol is rewriting history in more ways than we can imagine. Here’s everything you need to know about the history-altering move by StaFi.
Liquid Staking – The Purpose
The proof-of-work (POW) concept that makes popular blockchains like the Bitcoin Network and Ethereum Network tick is gradually losing its cool. That consensus’ unwholesome energy consumption is relegating such an important part of blockchain’s history to the bins. As the POW consensus loses its appeal, the opposite can be said about the proof of stake (POS) alternative. More applications are being built on POS chains than their POW counterparts.
An integral aspect of the POS consensus is the need for staking of assets on the chain by as many users as possible. Staking on POS chains is often highly lucrative as it ensures the chain operates optimally without the energy-draining mining activities that haunted POW chains.
Though highly rewarding, staking on POS chains is rather rigid. Unstaking takes longer than desired, which reduces its appeal. Also, the initial staking requirement is often high, discouraging self-staking in the process. Liquid staking was born to provide a way around these pitfalls, so the consensus is more efficient in the process. And it did achieve some of that purpose. More users now use liquid staking solutions like StaFi to stake on the POS chain.
StaFi Liquid Staking Solution And The Role Of The rDEX
Staking Finance (StaFi) has been in the business of allowing users to access their liquidity trapped in a POS chain. Not being able to unstake assets locked in these chains for days (sometimes weeks) is something users struggle with when they choose staking POS chains. Fortunately, the liquid staking solutions provided by platforms like StaFi help users get out whenever they want. An integral part of this solution is the trading of rTokens. In the past, liquidity had to be added on popular DEXs across the different POS chains covered to allow for the trading of these staking derivatives. However, the StaFi protocol has brought trading of these rTokens under one umbrella – the rDEX.
The launch of the rDEX is a history-altering move for StaFi. It showcases the protocol in a different light, one that most users are largely unaware of.
How many liquid staking solution vendors build DEXs to support the trading of their staking derivatives?
Most of the competition continues to do it the old-fashioned way – add liquidity on DEXs for the trading of the interest-bearing tokens. It's not a bad approach, but expectations are rising in this space.
StaFi opting to develop the rDEX is an indication of the team’s thoughtfulness. Sometimes, all you need to succeed in this space is understanding the plight of users and doing something to soothe that pain, which is exactly what StaFi has done with the launch of this DEX. In the past, users experienced lots of issues from trading rTokens on the different decentralized exchanges supported. Sometimes, illiquidity was a problem; other times it’s the case of impermanent loss for liquidity providers. With the introduction of the rDEX, all rTokens trading is done in one place. It’s no longer the scattergun approach that saw liquidity added on different DEXs; now all the magic happens in one place.
StaFi’s rDEX – History In The Making
Many believe the Staking Finance Protocol took a big gamble with the development of the rDEX. You can’t fault their reasoning. Innovation is often seen as a gamble, especially if it challenges the status quo. The rDEX launch belongs in this category. Of course, StaFi might have easily continued to incentivize liquidity providers on the multiple supported DEXs across different chains, but that doesn’t make the DeFi protocol truly disruptive.
StaFi’s rDEX is the protocol’s odd chance at rewriting history as it becomes the first decentralized exchange specially built for trading rTokens. If the DEX operates as expected, it will change the liquid staking game as we know it. For one, the bar gets raised that every other liquid staking vendor has to up their game.
This move will improve the liquid staking solution service that users receive. It’s no longer the case that anything goes – all platforms would have to sit up, which is good for the crypto space.
StaFi has made several promises regarding the operations of the rDEX. One of such promises is the safety of the DEX. In the crypto space, decentralized exchanges are considered soft targets since there’s no central body scrutinizing transactions. This affects the rDEX as well despite StaFi’s grip on the exchange. However, it’s great that measures such as audits and bug bounties have been taken to shield the DEX from hacks and exploits. This reinforces the history-making status of the rDEX, highlighting its capacity to bring about some much-needed change in liquid staking.
StaFi began rewriting history months ago when it launched its liquid staking solution. The unveiling of its rDEX is the masterstroke that speaks of the DeFi protocol moves to ensure mainstream adoption of liquid staking. Will StaFi succeed in altering history in the protocol’s favor?
You can learn more about StaFi Protocol by visiting the websites below: