Solana’s Largest Protocol, Marinade, Bets Growth on ‘Native’ SOL Staking Product

Top Solana protocol Marinade Finance will support direct-to-validator staking of tokens alongside its popular mechanisms for issuing mSOL, the liquid staking token (LST).

The protocol’s new service, called Marinade Native, eliminates the smart contract risk of swapping SOL for mSOL while preserving the expected yield of around 7%, developers say. That’s because users retain custody of their SOL as opposed to receiving what amounts to a yield-infused depository receipt.

Marinade is already responsible for $167 million in crypto assets – just a touch over half of the total value locked (TVL) on Solana. But its solution seems to have hit a ceiling at 2% of the network’s SOL, protocol insiders say. They’re convinced Marinade’s further growth will come only from appealing to institutional investors too weary to handle LSTs.

“Marinade Native is basically targeting the 50-times bigger market and hoping to see more decentralization within staking on Solana,” said Michael Repetny, a core contributor to Marinade.

Staking SOL directly to validators is not new. It’s the original method investors used to capture the upside of Solana’s , which pays interest to those who financially vouch for the validators powering the network.

What is new is that it spreads the staked SOL across an index of top validators rather than just one. The technique, called automated staking, is one of the two main benefits of its LST mechanism, alongside the part where it issues mSOL.

“It’s not staking to one, but to about 130 validators that are ranked based on their performance, based on some decentralization aspects and so on,” Repetny said. “We’re introducing a product that relies on this automated staking and avoids completely the smart contract risk.”

Edited by Sheldon Reback.