♻️What is Liquidity ReStaking
Last updated
Last updated
Staking is a simple yet powerful concept, and today, crypto users are eager to stake everything—from stablecoins like USDe to PoW reward tokens like BTC. We call it 'staking', but under the surface, Ethereum staking, governance token staking, stablecoin staking, and BTC staking each have different mechanisms behind them. Ultimately, stakers expect rewards or increased influence for locking their assets.
With the emergence of liquid staking, staked assets became transferable and reusable via smart contracts. Liquid staking tokens (LSTs) can be deposited to DeFi pools to earn extra fees on top of the staking rewards. Restaking is much like depositing LSTs into DeFi pools, but instead it generates extra rewards through a dedicated restaking contract. It’s just a matter of how the extra rewards are generated for restakers.
Restaking generally involves harnessing the power of concentrated liquidity in the infrastructure level. EigenLayer uses it to provide trustless security to actively validated services. Solayer uses it to let its consumer protocols haver their transactions included without transaction failures in newly produced Solana blocks. In return, EigenLayer AVSs and Solayer consumer protocols pay the restakers with their tokens, generating extra rewards for the restakers. The methods may differ, but the results are the same: restakers earn extra rewards in the form of tokens issued by the restaked projects.
Kaia's focus is on onboarding the next billion users in Asia to Kaia via Line messenger mini dApps. Hundreds of small builders are building on LINE messenger using NEXT WEB SDK to connect Kaia and LINE users. Lair's mission is to establish a framework to reward ecosystem participation that contributes to increasing the network/user growth. This framework makes it possible to strongly align the incentives of Lair restakers, Mini dApp builders, and consumers.
LINE messenger mini dApps are set to bring the next billion web2 users to the Kaia ecosystem. However, the challenge is to bridge the gap between the existing Kaia community and the new users from LINE mini dApps. The existing Kaia community mainly interacts with the chain via staking and trading. The new-comers will interact with the chain via consumer focused apps like games, socialFi, and Memes. The best way to align the incentives of the two communities is sharing bags. The existing Kaia community earns the new projects' tokens for restaking with Lair. The new LINE mini dApp user community earns $stKAIA as the rewards for participating in the Kaia ecosystem.
Liquidity restaking aligns the interests of Kaia's early stakeholders with the success of new dApps on the network. It also contributes to making the web2 LINE mini dApp users get settled to the Kaia community. Liquidity Restaking plays a pivotal role in uniting the two different community to foster a healthier growth of the chain.
$KAIA holder stakes with Lair.
Lair stakes $KAIA with multiple GC members for the best APY and security.
Kaia chain distributes staking rewards.
Lair distributes staking rewards to stakers.
Lair directs a portion of these rewards to the liquidity vault.
LINE game users receive receipt tokens while playing.
Users submit receipt tokens to the liquidity vault.
Users claim $stKAIA rewards based on their receipt tokens.
Integrated LINE games distribute tokens to Lair DAO and restakers.
Lair provides incentives to new LINE mini dApp users, integrating them into the Kaia community.
Lair provides $KAIA incentives to the new LINE mini dApp users and bring them into the Kaia community. LINE mini dApps distributes their tokens with Lair stakers and bring the into their communities. The two sides form symbiotic relationship with each other and grow together.
To receive Lair restaking rewards, a user must restake their liquid staking tokens (LST) like $stKAIA, $sKLAY, $gcKLAY, or $stKLAY into the Lair restaking contract, which mints $rstKAIA, a liquid staking token. Lair’s liquidity vault then receives $stKAIA emissions directly from Lair.
For LINE games to provide $stKAIA rewards to their players, they need to offer incentives to the Lair DAO. Upon acceptance, users of the approved games can claim rewards from the Lair liquidity vault using receipt tickets provided by LINE games. In this setup, LINE games and the Lair DAO act as intermediaries between game users and restakers. All rewards and incentives flow to users and restakers through the Lair liquidity vault contract.
This setup benefits both groups: gamers receive liquid tokens as rewards, giving them a chance to explore other services within the Kaia ecosystem using $stKAIA. Meanwhile, on top of the native staking rewards, Lair restakers earn extra rewards in new game tokens.
Lair DAO selects and rewards aspiring mini dApp communities, ensuring their growth benefits the entire ecosystem. It's also responsible for distributing the protocols' tokens to the Lair restakers, making sure the restakers receive what they deserve. The role of Lair Dao in Liquidity Restaking will be delegated to the Lair core team until the $LAIR token TGE and the Dao setup.
