The Importance of Liquid Staking
The Problem Stacking DAO solves
Staking, as it stands, isn’t a smooth experience—and it’s become even more complex with the Stacks Nakamoto upgrade:
Each staking cycle lasts 2 weeks, which means long wait times to unlock and restake
Rewards don’t start immediately—users may wait a full cycle before seeing any yield
A high minimum of around 90,000 STX is required to participate
With Nakamoto live, users must now run a node with liveness to stake directly
StackingDAO was built to solve these issues and make staking more accessible, efficient, and rewarding.
What is Staking? Staking is the process of locking STX to participate in the Stacks consensus mechanism, helping to secure the network. It’s similar to staking ETH on Ethereum.
Currently, over 400 million STX are staked, earning an annual yield of 9% or more. You can track live statistics on the stacking-tracker website.
The Solution
StackingDAO offers a liquid staking protocol that provides users with tokenised representations of staked STX: stSTX and stSTXbtc. Think of it as Lido or Jito, but for Stacks.
Key benefits include:
No more 2-week unstaking delays – With stSTX-STX pools on a DEX, users can trade back to STX anytime (for both stSTX and stSTXbtc)
Instant, continuous yield – Rewards start accruing daily from the moment of deposit
No 90k STX minimum – Users can stake any amount
No need to run a node – StackingDAO handles node liveness post-Nakamoto upgrade
As liquid, yield-bearing assets, stSTX and stSTXbtc are positioned to become core building blocks of the emerging Bitcoin DeFi ecosystem—particularly as collateral. For STX holders, borrowing against these tokens is likely to be the most tax-efficient way to access liquidity.
Why hasn’t liquid staking taken off on Stacks before?
Although Stacks has been live since 2021, liquid staking only became technically feasible in 2023. Before April of that year, Stacks smart contracts didn’t support continuous staking, which is essential for liquid solutions.
Demand for delegated staking is now expected to rise significantly. With the 2024 Nakamoto upgrade, users must run a node with liveness to stake—an added technical hurdle that will likely push most users toward custodial or delegated staking options.
For these reasons, StackingDAO received a grant from the Stacks Foundation to research and develop a liquid staking protocol purpose-built for the post-Nakamoto era.
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