What does it mean to “supercharge stake?”
Oct 7, 2022 • 3 min read
Tenderize is introducing the concept of tokenized stake, offering more flexibility and utility to Web 3 infrastructure players. Tenderize has a full roadmap to unleash the full potential of staked assets, creating new use cases for Web 3 token holders in what we like to call “supercharge stake.” Discover more about our mission and how we will bring it to life.
What is the current state of traditional staking?
The current state of staking is broken.
You deposit funds for a fixed locking period and earn some staking rewards. That’s the current process with traditional staking.
Despite gaining some passive income on your investment, you have no control over your tokens while the locking period is in place, becoming susceptible to any changes in the tokens’ underlying price.
Beyond the lack of control in managing your portfolio while staked, there are no additional use cases for your staking rewards or underlying tokens, opening up a steep opportunity cost.
Do liquid staking platforms solve the flexibility issue?
Liquid staking platforms solve the problem of flexibility by introducing no-locking periods in staking. Centralized exchanges and other third parties allow you to stake popular crypto assets (e.g., ETH) in a pool with less capital needed and no waiting periods.
That experience is available for some of the most popular crypto assets, but the decentralized space is more than Ethereum, Cardano, or Solana. Despite these platforms bringing more flexibility to those who want to stake these assets and generate rewards, the use cases practically end there.
The first part of the staking conundrum - flexibility - seems addressed for popular tokens, but the experience from then onwards is profoundly lacking.
What are the particular challenges for staking on Web 3?
Web 3 tokens holders and infrastructure providers currently have few options on the liquid staking front. Web 3 is the crypto segment where investors and operators face harsher challenges to achieve capital efficiency and diversification.
If you’re a Web 3 operator like a node provider, you’re gaining rewards from your work under a Web 3 infrastructure player. If you want to generate more rewards, you have to:
- Natively stake and experience a high barrier of capital requirements, technical expertise, and hardware needs.
If you choose to natively stake, you have to face a few steps to allocate your tokens and generate rewards:
- Find a validator that does a good job under your network
- Deploy funds (usually high capital requirements)
- Track the validator’s performance and re-evaluate if this is the right allocation
The current process is time-consuming and complex. There is a high barrier to entry for capital efficiency and diversification for Web 3 operators. However, with the right solutions, these players can encounter many use cases from their original rewards.
Introducing “supercharge stake:” First, addressing flexibility
Tenderize’s mission is to fulfill the entire potential of staked assets.
We’re building a “decentralized and composable staking middleware protocol,” enabling more capital efficiency and diversification for Web 3 token holders with a neutral approach based on automation.
Tenderize has two main goals with its approach:
- Make flexible staking accessible for Web 3 operators
- Unleash utility for staked assets, creating new use cases for holders
The 1st step is making liquid staking for Web 3 tokens as easy as for any popular crypto asset. Currently, you can stake GRT, LPT, AUDIO, and MATIC with no lock-up periods and enjoy attractive staking rewards in a few clicks on Tenderize.
The 2nd stage of supercharge stake: A myriad of use-cases, fulfilling Web 3’s potential
Tenderize currently does the delegation of the tokens for you, originating yields from the actual adoption of Web 3 networks instead of artificial token inflation.
This way, Tenderize is able to unlock staked assets and, most importantly, their cash flows, addressing our 2nd goal. If all that capital is liquid, Web 3 operators can reinvest in their operations and supercharge their growth.
Tenderize can help with the diversification of the original income from Web 3 operators and their staking rewards in a crypto world full of opportunities.
Tenderize’s V2 will go further to personalize the experience by creating a collateralized stake linked to each validator, creating more opportunities for those who perform well.
From there, users can use these staked assets - TenderTokens - in several DeFi vehicles for extra returns or to satisfy their liquidity needs (e.g., crypto loans).
Fulfilling the Web 3 mantra with Tenderize
Tenderize is on the mission to bring the Web 3 mantra to its full realization on the staking front. Web 3 means freedom, financial opportunity, and ownership for everyone. Why shouldn’t you own the entire process?
With Tenderize, we’re boosting “economic primitives and incentives” across Web 3 networks, offering more use cases for operators to achieve efficiency while growing and contributing to the adoption of decentralized solutions.
We envision this world of opportunity based on an open and neutral approach, where Tenderize is simply the vessel through which Web 3 achieves more flexibility and use cases.
Alpha in your inbox,
Subscribe now!
Subscribe to our newsletter and receive exclusive insights and be the first to know about new releases.
We will never spam you.