The dYdX Foundation has partnered with Stride to enhance staking options in the Cosmos ecosystem by introducing liquid staking to the blockchain.
Stride is recognized as the leading liquid staking provider in the Cosmos ecosystem and brings significant expertise to this initiative.
The dYdX chain also plans to expand liquid staking options by partnering with other providers such as Persistence and Quicksilver. This represents a growing trend in the cryptocurrency industry where liquid staking is gaining popularity.
Liquid staking allows participants to lock up tokens in return for receiving tokens. These receipts can be actively used or traded in decentralized finance (defi) applications. According to DeFiLlama, the total value locked (TVL) of liquid staking derivatives currently stands at over $31.1 billion, highlighting their significant role in the DeFi sector.
With this new feature of dYdX, token holders can now earn staking amounts for the native token (DYDX) of dYdX v4. The attractive aspect of staking here is that stakers receive trading and transaction fees in USDC. This not only contributes to securing the dYdX v4 chain, but also provides opportunities for additional revenue generation.
Stride co-founder Riley Edmunds highlighted the stability and potential of stDYDX as a source of collateral for the defi ecosystem within Cosmos. He pointed out that this plan could encourage DYDX holders, especially those not currently participating or active in Ethereum DeFi, to divert their liquidity to the Cosmos ecosystem.
Stride also plans to incentivize participation by executing one of the largest STRD token airdrops. During the first 120 days of launch, we will distribute up to 100,000 STRD tokens to users who liquidly stake DYDX using Stride for stDYDX.
Edmunds also emphasized the strategic importance of this integration. He noted that dYdX, the largest decentralized exchange by trading volume, attracts a massive audience. This collaboration not only introduces these users to the Cosmos ecosystem, but also potentially increases overall interest and engagement within this space.