ARCIPEDIA · YIELD

Plain English

Liquid staking is a way to stake ETH (or other proof-of-stake assets) while receiving a transferable token that represents your staked position plus accumulated yield. Lido’s stETH is the largest example.

How it actually works

You deposit ETH into the liquid-staking protocol. The protocol runs validators on your behalf and mints you a liquid token (stETH, rETH, cbETH) at a 1:1 ratio. The token accrues yield over time. You can sell, transfer, or use it as DeFi collateral while your underlying ETH remains staked. To unstake, you redeem the liquid token back for ETH — subject to the chain’s unstaking queue.

What it means for you

For ETH stakers, liquid staking solves the capital-efficiency problem of native staking. You earn validator rewards AND keep the asset usable as collateral. The trade-off is protocol risk (one more layer of smart contracts) and validator concentration risk.

How ARCrypto teaches this

The curriculum covers liquid-staking protocol selection, the practical differences between Lido, Rocket Pool, and Coinbase’s cbETH, and how to deploy stETH as collateral in lending strategies.

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Educational content only. Not investment, tax, or legal advice.