Step-by-step guide to liquid staking on Solana

Liquid staking on Solana lets users stake SOL, earn rewards, and retain liquidity via stSOL tokens, which can be used in DeFi for added yield.

Jul 20, 2025 at 06:42 am

What is Liquid Staking on Solana?

Liquid staking is a mechanism that allows users to stake their cryptocurrency while retaining liquidity through the issuance of a tokenized representation of their staked assets. On Solana, this process enables users to earn staking rewards without locking up their SOL tokens, as they receive a derivative token—often referred to as stSOL or similar—representing their stake. This derivative token can be used in decentralized finance (DeFi) applications, providing flexibility and additional yield opportunities.

In traditional staking, users lock up their tokens for an indefinite period to support the network's security and consensus. However, this approach reduces capital efficiency. Liquid staking solves this issue by allowing users to maintain exposure to their staked assets while enabling them to participate in other financial activities.

Choosing a Liquid Staking Provider on Solana

To begin the liquid staking process, users must first choose a trusted liquid staking provider on the Solana network. Popular platforms include Lido Finance, Marinade Finance, and Jito Network, among others. These platforms act as intermediaries, pooling staked SOL from multiple users and distributing staking rewards proportionally.

Before selecting a provider, consider the following:

• Reputation and security audits of the platform
• Fee structure for staking and unstaking
• Supported wallets, such as Phantom or Solflare
• Availability of stSOL derivatives and their integration with DeFi protocols

Once a provider has been chosen, ensure your wallet is compatible and connected to the platform's interface.

Connecting Your Wallet to the Liquid Staking Platform

The next step involves connecting your Solana-compatible wallet to the chosen liquid staking provider. Here’s how to do it using Phantom Wallet as an example:

• Open the liquid staking platform in your browser
• Click the "Connect Wallet" button
• Select Phantom from the available options
• Approve the connection in the Phantom extension pop-up

Once connected, your wallet address and SOL balance will be visible on the platform. Ensure that you have sufficient SOL to stake and leave a small amount for transaction fees, usually around 0.01 SOL.

Staking SOL and Receiving stSOL Tokens

After connecting your wallet, proceed to the staking interface of the platform. Here’s a breakdown of the steps:

• Enter the amount of SOL you wish to stake
• Review the transaction details, including any fees
• Confirm the transaction in your wallet
• Wait for the transaction to be finalized on the Solana blockchain

Once the transaction is confirmed, you will receive an equivalent amount of stSOL tokens in your wallet. These tokens represent your staked SOL and accrue staking rewards over time. You can track your staking rewards and the value of your stSOL in real time through the platform.

It's important to note that stSOL may have a different exchange rate than SOL over time due to accumulated rewards. Always verify the current exchange rate before using stSOL in DeFi protocols.

Using stSOL in DeFi Protocols

One of the main advantages of liquid staking is the ability to use stSOL tokens in various DeFi applications. These tokens can be deposited into liquidity pools, used as collateral for loans, or supplied to yield-generating protocols.

Here’s how to use stSOL in a DeFi application:

• Navigate to a supported DeFi platform, such as Raydium or Orca
• Connect your wallet as before
• Locate the stSOL token in the available assets
• Deposit or supply stSOL to the relevant pool or market
• Confirm the transaction and monitor your yield

Ensure that the DeFi platform accepts the specific stSOL token issued by your liquid staking provider. Not all platforms support every derivative token, so double-check compatibility before proceeding.

Unstaking and Withdrawing Your SOL

When you decide to unstake your SOL, the process may vary depending on the provider and whether the unstaking is instant or requires an unbonding period. Some platforms allow instant unstaking via a liquidity pool, while others require a waiting period before your SOL becomes liquid again.

To unstake:

• Go to the unstaking section of the liquid staking platform
• Choose the amount of stSOL you wish to unstake
• Initiate the unstaking process
• Confirm the transaction in your wallet

If the platform uses an unbonding period, your SOL will be released after a set time, typically 2–7 days, depending on the protocol. If instant unstaking is available, you can receive your SOL immediately, often at a small fee.

Frequently Asked Questions

Q: Can I stake any amount of SOL using liquid staking?

A: Most platforms allow staking from as little as 0.1 SOL, but this can vary. Check the minimum staking amount on your chosen provider's platform before proceeding.

Q: Are stSOL tokens transferable to other wallets?

A: Yes, stSOL tokens are standard SPL tokens and can be transferred to any Solana-compatible wallet. However, ensure the receiving wallet supports the specific stSOL token version.

Q: What happens if the liquid staking provider gets hacked?

A: Security is a critical factor when choosing a provider. Look for platforms with audited smart contracts, insurance funds, or decentralized governance to minimize risk. Always research the provider's track record and community feedback.

Q: Can I earn additional rewards by staking stSOL in DeFi?

A: Yes, many DeFi protocols offer dual yield opportunities by allowing users to stake stSOL in liquidity pools or lending markets. Always assess the risk-reward ratio and understand the platform's security before depositing funds.