GlossaryWhat is liquid staking?
What is liquid staking?
Liquid staking is staking through a protocol that gives you a token in return, a liquid staking token, that stands for your staked coins and their rewards and can still be moved or used. On November 8, 2026, DefiLlama counted about $50.5 billion in liquid staking protocols.
How Liquid Staking Works
Liquid staking works by pooling deposits, staking them with validators and handing each depositor a receipt token. On Ethereum a validator needs 32 ETH, and ethereum.org notes that the protocol has no built-in way to pool smaller amounts, so liquid staking protocols do the pooling in smart contracts, as described on ethereum.org's pooled staking page.
The receipt is an ERC-20 token. It can be held, sent or used in other apps while the ETH behind it keeps earning staking rewards, which is the difference from plain staking where the coins sit locked.
Liquid Staking Tokens: Rebasing vs Exchange Rate
Liquid staking tokens pass on rewards in one of two ways, rebasing or a rising exchange rate, and ethereum.org uses Lido and Rocket Pool as its examples.
- Rebasing (stETH): your token balance grows. Lido says stETH balances update daily at 12PM UTC.2
- Exchange rate (rETH): your token count stays the same, and each token becomes redeemable for more ETH over time.
Both kinds carry the same staking risks covered below, and the crypto glossary links the related staking terms.
Biggest Liquid Staking Protocols
The biggest liquid staking protocols on November 8, 2026 were Lido, Binance staked ETH and ether.fi, according to DefiLlama's liquid staking list. These sizes are a snapshot from that day, since deposits move every hour. For scale, all of DeFi held $78.5 billion at this check.
Lido charges a 10% fee on staking rewards, split between node operators and its DAO treasury, and the DAO can change it by vote.4 On Solana, Jito pools SOL across many validators and returns JitoSOL, which it says is usable in DeFi straight away.5
| Protocol | Main chain | TVL |
|---|---|---|
| Lido | Ethereum | $21.6 billion |
| Binance staked ETH | Ethereum | $8.6 billion |
| ether.fi Stake | Ethereum | $4.2 billion |
| JustLend sTRX | Tron | $3.2 billion |
| Rocket Pool | Ethereum | $1.1 billion |
| Jito Liquid Staking | Solana | $910 million |
Liquid Staking Risks
Liquid staking risks, as ethereum.org lists them, sit on top of the normal risks of staking itself.
- Smart contract risk: a bug in the contracts that hold the pooled ETH.
- Market and liquidity risk: the token can trade below the ETH behind it, and redemptions can be slow.
- Governance risk: fees, operators and token rules can change, often without holders getting a vote.
- Operator concentration: a few node operators running much of the stake.
- Slashing pass-through: penalties on a validator are usually shared across all holders.
A token trading below its backing is similar in effect to a stablecoin depeg, even though the cause is different.
Liquid Staking vs Restaking
Liquid staking and restaking are different steps: liquid staking gives you a token for staked ETH, while restaking puts that staked ETH, or the token, to work securing other services. ethereum.org describes liquid restakers as people who restake the tokens they got from Lido or Rocket Pool. The restaking page explains the extra rewards and risks.
Questions People Ask About What is liquid staking
These are the questions people ask next about what is liquid staking.
What is a liquid staking token?
A liquid staking token is a receipt token a protocol gives you when you stake through it, standing for your staked coins plus rewards. ethereum.org describes it as an ERC-20 token you can hold, transfer or sell while the ETH behind it stays staked.
Is liquid staking safe?
Liquid staking is not risk free. ethereum.org lists smart contract bugs, the token trading below its backing, slow redemptions, governance changes, concentrated operators and shared slashing penalties as the main risks of liquid staking tokens.
What is the difference between staking and liquid staking?
The difference between staking and liquid staking is what you hold afterward. With plain staking the coins are locked with a validator. With liquid staking you get a token back that you can move or use while your stake keeps earning.
How much ETH do I need for liquid staking?
Liquid staking needs far less ETH than running a validator, which takes 32 ETH. ethereum.org lists Lido and ether.fi as taking any amount and Rocket Pool from 0.01 ETH. The ETH staking calculator shows the math on rewards.
Sources
Every number on this page comes from these sources, checked November 9, 2026.