Solana Liquid Staking Could Touch $18 Billion Will It Benefit These Altcoins?
A new report has highlighted the key changes that could follow a significant increase in Solana liquid staking. Driven by strong investor demand, if Solanas liquid staking were to reach $18 billion, it could significantly benefit Solana (SOL) and Jito (JTO), a liquid staking token on the Solana blockchain, potentially fueling positive momentum and a rise in the value of both altcoins.
Adoption Boom To Ignite Solana Liquid Staking
Over the past few years, SOL has had an impressive run, outperforming most altcoins while leading the meme coin market with its numerous blockchain-based meme coins. However, the cryptocurrencys Liquid Staking ratio has remained significantly low compared to Ethereums. Only 6.5% of Solana is staked through liquid staking, marking just one-third of Ethereums LSTs.
In a recent report, Bybit disclosed that while Liquid Staking Tokens (LST) on the Solana blockchain did not experience immediate growth right off the bat, they are now starting to show signs of expansion and dominance in the DeFi landscape.
Currently, half of the top 10 largest DeFi protocols by Total Value Locked (TVL) on Solana are now Liquid Staking providers, suggesting a rapid growth in the LST market. Additionally, the total market capitalization of LSTs on Solana has increased to $3.6 billion, reflecting a nearly 16X increase in its value from a year ago.
Based on Ethereums LST market statistics, Bybit predicts that Solanas LST market could potentially grow to $18 billion, representing 5X more than its current value. However, this massive surge is dependent on whether Solanas LST ratio reaches that of Ethereums.
Given how ambitious a $18 billion surge is, Bybit has considered it a more conservative and potentially attainable estimate. The report has suggested that if Solanas liquid staking ratio were to grow by only 10%, it would represent a 53% increase in the size of its liquid staking market.
For this to happen, Solanas DeFi ecosystem is expected to gradually expand while the demand for LSTs on the blockchain rises. This increased demand may lead to massive adoption, attracting more developers, users and protocols to the Solana ecosystem.
Furthermore, Bybit has highlighted its role in developing and improving the growth of Solana LSTs. To help drive massive adoption in Solanas LST market and DeFi ecosystem, Bybit has announced its plans to launch its own liquid staking token on the Solana blockchain.
Key Players To Gain From Solanas Liquid Staking Growth
Notably, the growth of Solanas Liquid Staking could greatly influence the price dynamics of both SOL, Solanas native token and JTO, the native token of Jito. A rise in Solana LSTs signals heightened adoption of the blockchain, which could attract a wave of new investors and users to SOL.
This, in turn, could drive positive momentum for SOL, enabling the altcoin to potentially experience a significant price rally. Meanwhile, JTO, one of the key altcoins in the Solana LST market, stands to benefit immensely if Solanas liquid staking reaches $18 billion.
With nearly $1.8 billion in staked SOL and 50% Solana LST market share, JTO is ideally positioned to capitalize on the projected growth of Solanas Liquid staking ecosystem.
Featured image from ByteTree, chart from TradingView
Text source: NewsBTC
