The rise of liquid staking tokens (LSTs) in the Ethereum ecosystem has been nothing short of transformative. From fueling DeFi growth to enabling re-staking protocols, LSTs have unlocked new layers of capital efficiency and yield generation. Yet, this momentum hasn’t spread evenly across other blockchains—especially not to Solana, despite its high performance and growing DeFi activity.
Why is that? While Ethereum’s dominance in market cap and developer mindshare plays a role, deeper structural and ecosystem-level factors are at play. In this article, we’ll explore the current state of liquid staking on Solana, compare it with Ethereum’s trajectory, analyze key players, and uncover the untapped potential that could reshape Solana’s DeFi landscape.
📊 Solana vs. Ethereum: A Staking Adoption Gap
One of the most striking contrasts between Solana and Ethereum lies in liquid staking adoption.
- On Solana, over 60% of SOL is staked, yet only 6%—approximately $3.4 billion—comes from liquid staking.
- In contrast, 32% of all staked ETH is represented by liquid staking derivatives like stETH or wstETH.
👉 Discover how liquid staking is reshaping blockchain economies today.
This gap suggests that while Solana users are eager to stake for network security and rewards, they’re far less inclined to use liquid staking solutions that provide tradable, yield-bearing tokens.
Why the Difference?
The answer may lie in protocol-level design choices.
Solana offers native delegation, allowing users to easily stake SOL through validators without needing third-party protocols. This simplicity reduces the urgency for LSTs. In contrast, early Ethereum stakers faced high entry barriers (e.g., 32 ETH minimum), making Lido and similar services essential for retail participation.
As a result, liquid staking became not just convenient—but necessary—on Ethereum. On Solana, it remains an optional upgrade, not a necessity.
🔍 Market Share Distribution: More Balanced Than Ethereum
Despite lower overall adoption, Solana’s LST market shows a healthier competitive landscape than Ethereum’s.
- On Ethereum, Lido controls 68% of the liquid staking market—approaching monopoly status.
On Solana, the top three LSTs hold about 80%, but the distribution is far more balanced:
- jitoSOL: 46%
- mSOL: 23.5%
- bSOL: 11.2%
This diversity fosters innovation and gives users more choice—critical for a healthy DeFi ecosystem.
⏳ Evolution of Liquid Staking on Solana
Liquid staking on Solana didn’t start strong. Early entrants like stSOL (Lido), mSOL (Marinade), and scnSOL (Sanctum) collectively held less than $1 billion in market cap. Adoption was slow due to:
- Limited marketing efforts
- Sparse DeFi integrations
- Lack of narrative focus on capital efficiency
The FTX collapse further dampened sentiment: liquid staking dropped from 3.2% to just 2% of total staked SOL.
But everything began to shift with the emergence of Jito.
🚀 The Rise of jitoSOL: How Jito Dominated the Market
Launched in November 2022, jitoSOL quietly gained traction by focusing on three core pillars:
- MEV (Maximal Extractable Value) Rewards: Unlike traditional LSTs, jitoSOL captures MEV from transaction ordering and redistributes it to holders—adding ~5–8% APY on top of base staking yields.
- Deep DeFi Integration: Jito partnered with major Solana protocols like Jupiter, Orca, and Marginfi, ensuring liquidity and utility.
- Community Trust and Transparency: Regular updates, open governance discussions, and strong developer communication built lasting credibility.
Within a year, jitoSOL surpassed both stSOL and mSOL to become the dominant LST with 46% market share.
Today, the top five LSTs on Solana are:
- jitoSOL – 46%
- mSOL – 23.5%
- bSOL – 11.2%
- INF – 8.2%
- jupSOL – 3.6%
🔑 Keys to Success for Any Liquid Staking Token
Based on Jito’s success and broader market trends, three factors stand out as critical for any LST aiming for long-term relevance:
- Liquidity: Deep pools across DEXs ensure low slippage and easy entry/exit.
- DeFi Integration & Partnerships: The more protocols accept an LST as collateral or reward asset, the more valuable it becomes.
- Multi-chain Expansion: Future-proofing via deployment on other chains increases reach and utility.
Without these elements, even well-funded projects struggle to gain traction.
👉 See how leading protocols are leveraging liquid staking for growth.
💡 The Untapped Potential of Solana’s Liquid Staking
Liquid staking isn’t just about convenience—it’s a force multiplier for DeFi TVL.
On Ethereum, wstETH alone accounts for 40% of Aave v3’s TVL. It powers yield strategies on platforms like Pendle, enables restaking on EigenLayer, and underpins synthetic dollar systems like Ethena.
Solana is poised for a similar transformation.
Projected Growth Scenarios (Next 1–2 Years):
| Scenario | LST Ratio | Additional DeFi Liquidity |
|---|---|---|
| Base Case | 10% | +$1.5B |
| Bull Case | 15% | +$5B |
| Long-Term Bullish | 30% | +$13.5B |
If Solana reaches even 15% liquid staking penetration, its DeFi TVL could surge from current levels (~$2B) to over **$7B—potentially reaching $15–17B** when combined with organic growth.
🧩 Building Momentum: Who’s Driving Innovation?
A wave of high-quality teams is actively expanding the role of LSTs in Solana’s ecosystem:
- Drift Protocol: Integrating LSTs into perpetual trading and margin systems.
- Jupiter: Launching native jupSOL and enhancing swap routing for LST pairs.
- Marginfi: Accepting jitoSOL and mSOL as collateral for leveraged positions.
- BONK: Exploring community-driven staking initiatives.
- Helius Labs: Improving RPC infrastructure to support validator-backed LSTs.
- Sanctum: Expanding multi-LST vaults and yield aggregators.
- Solana Compass: Providing analytics and reputation scoring for LST providers.
Competition breeds innovation—and that’s exactly what Solana needs to unlock its next phase of DeFi maturity.
❓ Frequently Asked Questions (FAQ)
Q: What is liquid staking?
A: Liquid staking allows users to stake their crypto assets while receiving a tokenized representation (like jitoSOL) that can be traded or used in DeFi applications—offering both yield and liquidity.
Q: Why isn’t liquid staking more popular on Solana?
A: Because Solana supports direct protocol-level staking, many users don’t feel the need for third-party LSTs. Additionally, earlier LSTs lacked strong DeFi integrations and compelling yield advantages.
Q: Is jitoSOL safe to use?
A: jitoSOL is backed by a reputable team, has undergone multiple audits, and benefits from extensive community scrutiny. However, as with any DeFi asset, always assess smart contract risk and diversify exposure.
Q: Can I earn more with jitoSOL than regular staking?
A: Yes—jitoSOL typically offers higher returns due to MEV rewards, which add several percentage points to base staking yields.
Q: Are there risks in using LSTs?
A: Yes. Risks include smart contract vulnerabilities, validator slashing, centralization of operators, and potential depegging during extreme market stress.
Q: Will Solana ever match Ethereum’s LST adoption?
A: It’s possible—if DeFi protocols continue integrating LSTs and user incentives improve. With the right momentum, Solana could reach 20–30% LST adoption within a few years.
✅ Final Thoughts: The Future Is Liquid
While Solana lags behind Ethereum in liquid staking adoption, the foundation is being laid for explosive growth.
With Jito leading the charge, a diverse set of competitors innovating rapidly, and increasing integration across DeFi, liquid staking could soon become one of Solana’s most powerful value drivers.
For investors, developers, and users alike, now is the time to understand—and engage with—this evolving space.
👉 Stay ahead of the curve in the next wave of blockchain innovation.
The era of idle staked assets is ending. The future belongs to those who make their capital work harder—across chains, protocols, and yield opportunities.
And on Solana, that future is starting to take shape—one liquid staked token at a time.