Venus Protocol Announces the Introduction of Liquid Staked ETH Pools

Venus Protocol, a top 5 decentralized finance (DeFi) lending platform, is announcing the deployment of new Liquid Staked ETH pools across multiple blockchain networks, including Arbitrum, Ethereum, and BNB Chain. This initiative aims to enhance the platform’s capabilities by offering diverse collateral options, increased liquidity, and new opportunities for users.

Following the approval of VIP-363, Venus Protocol will introduce a “Liquid Staked ETH” pool on Arbitrum One. This new pool will feature markets for WETH, wstETH, and weETH, with risk parameters carefully aligned with recommendations from Chaos Labs. The use of Lido’s wstETH and EtherFie weETH as collateral on the Ethereum mainnet demonstrates the demand for such assets on the Venus platform. On BNB Chain, users can supply these assets for borrowers and accumulate rewards. Additionally, vaults utilizing yield strategies, such as recursive staking, can tap into Venus’s market to borrow ETH and loop wstETH, further enhancing their benefits. 

“We are committed to driving innovation and scaling DeFi  to meet the evolving needs of a global  community,” said Brad Harrison, Head of Venus Labs. “The introduction of Liquid Staked ETH pools across multiple networks is a significant step in our mission to provide users with diverse and rewarding DeFi solutions.”

What is a Liquid Staking Token (LST)?

A Liquid Staking Token is a tokenized representation of staked assets. When users stake their assets, they receive an equivalent amount of LSTs, which can be traded, sold, or used in other DeFi protocols. This provides liquidity to the staker while their original assets remain staked, offering flexibility and additional opportunities within the DeFi ecosystem.

Key Benefits of Liquid Staked ETH Pools:

• Diverse Collateral Options: The addition of LS ETH assets diversifies collateral options available to users, enhancing the protocol’s flexibility.
• Ethereum Staking Rewards: Users can indirectly benefit from Ethereum staking rewards through LS ETH, leveraging these rewards within the Venus ecosystem.
• Enhanced Liquidity: Integrating LS ETH attracts new liquidity, providing users with more borrowing and lending opportunities.
• Staking Rewards: Users who deposit LS ETH can continue earning ETH staking rewards, creating additional income streams while participating in the protocol.

Deploying Liquid Staked ETH Isolated Pools on Arbitrum, Ethereum, and BNB Chain aligns with Venus Protocol‘s goal of expanding its ecosystem and offering innovative financial solutions to its users. This initiative is expected to provide numerous benefits, including diversified collateral options, increased liquidity, new earning opportunities, and enhanced risk management.

“We’re excited to see Venus Protocol integrating weETH across multiple networks. This integration aligns perfectly with our mission to make Ethereum liquid restaking more accessible and interoperable throughout the DeFi ecosystem. By offering weETH as collateral on Venus, users can now leverage their staked ETH assets more efficiently, potentially earning additional rewards while maintaining the benefits of Ethereum staking. This partnership exemplifies the growing demand for liquid staking solutions and the innovative ways DeFi protocols are utilizing these assets to create new opportunities for users.” said Mike Silagadze, CEO of ether.fi

Kenneth Tan, DeFi Protocol Relations Contributor at Lido also added: “wstETH’s integration across 3 major networks into the Venus LST pools is another step towards making wstETH accessible and the most usable liquid staked token in all of DeFi. Lending markets make up to almost 30% of where wstETH is being used in DeFi and on Arbitrum almost 75% of wstETH is utilized as collateral, exemplifying the demand for this integration. Additionally, this integration into Venus’s liquid staked ETH pool benefits users as it presents more opportunities and ways for them to be capital efficient on their staked assets.”