pStake Tutorial by Defi Dad

How to Earn 7% Staking ATOM with pStake

Before we get started, this is not a recommendation or endorsement to buy PSTAKE or ATOM.

Previously, I’ve written about Lido Finance, which lets users stake their assets for daily staking rewards, with no minimum, and mint a token which is commonly accepted as collateral or used to earn more fees as a market-maker. The idea is that you don’t have to lock up a PoS token like ETH (soon) or LUNA or SOL for long periods or be responsible for running a validator or simply restrict yourself to earning just the staking rewards, especially if you’d like to remain exposed to the price of the token and unlock liquidity by borrowing against it.

Today, there’s over $10B of value staking in Lido across ETH, SOL, and LUNA!

What’s concerning is that Lido has become a centerpiece of DeFi, not a single point of failure, but definitely a potential risk with no major competitors in liquid staking derivatives so far. However, what’s promising is that there are more protocols in development, one of which we’ll discuss today called pSTAKE, which happens to offer liquid staking derivatives for ATOM, the native token of Cosmos, which should have a lot of demand to unlock liquidity on Ethereum.

pSTAKE is a liquid staking protocol where stakers of PoS tokens can maintain the liquidity of their staking assets. pSTAKE users can earn staking rewards and simultaneously receive 1:1 pegged staked representative tokens (stkTOKENs) which can be used in DeFi to generate additional yield (on top of staking rewards) doing things like providing liquidity.

One notable difference