The total amount of Solana (SOL) locked on Binance’s liquid staking token for the cryptocurrency has surpassed the $1.3 billion milestone as adoption keeps rising, allowing investors to leverage the token in the decentralized finance (DeFi) space and on the exchange.
The token, Binance Staked SOL (BNSOL) is now the largest exchange-backed liquid staking token for the cryptocurrency, with each one representing Solana that is staked to help secure the network and receive rewards from it. Liquid staking tokens allow investors to earn staking rewards while maintaining the liquidity of their tokens.
This means that even as the tokens earn rewards, investors can boost their rewards by lending them, using them as collateral, or exit their positions in case of heightened market volatility.
The token’s growth is noteworthy as it was launched back in September of this year, just three months ago. The token has since been integrated into dozens of decentralized applications on Solana, although trading volume on decentralized exchanges has remained relatively muted.
The liquid staking token’s growth comes amid significant growth within the Solana ecosystem that has led to heightened competition among liquid staking projects.
Despite the heightened competition, Binance’s BNSOL is one of the largest SOL liquid staking tokens, behind Jito Staked SOL (JITOSOL), which has a market capitalization near $3 billion.
Most Solana tokens remain staked on-chain
According to data from Solana Compass over 394 million SOL tokens are currently being staked on the cryptocurrency’s network, meaning that around 66% of its total supply is earning rewards through its Proof-of-Stake consensus algorithm.
Data from Coinbase backs up the figure, showing that 66.17% of tokens are being staked on the network. The percentage of those that are in liquid staking tokens is currently unclear, as many investors take on the opportunity costs associated with the staking lock-ups.
