FP Lee, expert on liquid staking on Solana and founder of Sanctum, discusses launching LSTs, solving liquidity issues, and value accrual. They explore Sanctum products, winner-take-all scenarios, and stake-weighted QoS. Delve into the growth of liquid staking on Solana with insights on the future of the ecosystem.
Sanctum prioritizes converting unsaked Sol to staked Sol for yield and network security over TVL metrics.
Sanctum envisions an infinite LST future with diverse options supporting art, public goods, and adoption.
The Infinity Pool facilitates diverse stake rewards accumulation and capital-efficient, low-slippage trading environment.
Sanctum ensures stable exchange rates with zero-slippage swaps by refraining from using AMM curves or Oracle price.
Sanctum minimizes exploit risks by running most LSTs on the same smart contract, enhancing network security.
Deep dives
Liquidity and Conversion Focus at Sanctum
Sanctum is focused on evaluating the percentage of Sol liquidated in Liquid State, prioritizing conversion of unsaked Sol to staked Sol for yield and network security rather than metrics like TVL. This approach aims to tap into missed opportunities and broaden the utility of Liquid State tokens.
Building an Infinite LST Future at Sanctum
Sanctum envisions an infinite LST future where most, if not all Sol is staked, with emphasis on creating varied LSTs beyond mere yield generation. The protocol aims to enhance stake and trading yields, foster adoption, and enable a wide range of LST options to support art, public goods, and more.
Infinity Pool Innovation at Sanctum
The Infinity Pool by Sanctum stands out as the first LST holding other LSTs, allowing for diverse stake rewards accumulation and seamless asset swaps. This innovative approach facilitates multiple swaps within a single pool, offering a capital-efficient, low-slippage trading environment for Solana's LST ecosystem.
Stability and Security Considerations at Sanctum
Sanctum's focus on stability and security entails refraining from using an AMM curve or an Oracle price due to the semi-fungible nature of LSTs. This ensures a floor price stability and enables zero-slippage swaps within the protocol. By maintaining a consistent exchange rate protocol aims to boost user confidence and security in swaps.
Balancing Risk and Innovation at Sanctum
Sanctum addresses the risks associated with potential exploits and drain risks by ensuring most LSTs run on the same smart contract. By minimizing the addition of new LSTs with unique contracts, the protocol mitigates the risk of draining the entire pool. This strategic risk management approach enhances the security and stability of the network by efficiently rebalancing assets.
Partner Collaborations and LST Diversity
Sanctum's collaborations with partners like Jupiter, Helius, and others underscore its mission to support a diverse range of LSTs. By promoting a unique user loyalty program, Wonderland, the protocol engages users and aims to foster a vibrant ecosystem. Collaborations further focus on offering infrastructure for partners to launch LSTs, driving innovation and diversity in the Solana network.
Stake-Weighted QoS and Solana's Competitive Landscape
Sanctum's emphasis on stake-weighted QoS in the Solana network aims to tackle congestion and enhance transaction efficiency. This feature enables validators to land transactions proportionate to their stake, fostering fair competition and enhancing network security. As protocols leverage stake-weighted QoS, the Solana network gains efficiencies and competitive advantages in processing transactions.
Milestones and Future Outlook for Sanctum
Sanctum's strategic milestones over the next 12 to 18 months include tracking the percentage of Sol liquidated in Liquid State to drive conversion and network security. The protocol envisions transitioning LSTs to serve as a medium of value exchange, fostering Solana's role as a global currency. With a focus on building an infinite LST future and enhancing stake and trading yields, Sanctum aims to contribute to Solana's growth and utility.
Summary Conclusion
The podcast episode delves into Sanctum's innovative approaches to enhance Solana's LST ecosystem, focusing on liquidity optimization, expansion of LST utility, and network security. By highlighting unique features like the Infinity Pool, stake-weighted QoS, and strategic collaborations, Sanctum aims to revolutionize LST creation, trading efficiency, and network stability.
Gm! This week we welcome FP Lee to the show for a discussion on the growth of liquid staking on Solana. We deep dive into launching LSTs, value accrual, solving liquidity issues & some of the products sanctum is building. Enjoy!
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(00:00) Introduction
(02:21) Infinity
(09:55) Permissionless III Ad
(10:57) Algorithmic Auto Rebalancing
(15:54) Launching LSTs
(21:51) Solving LST Liquidity
(34:01) Value Accrual
(35:51) Sanctum Wonderland
(39:46) LSTs: Winner Take All?
(44:13) Stake Weighted QoS
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Disclaimers:
Lightspeed was kickstarted by a grant from the Solana Foundation.
Nothing said on Lightspeed is a recommendation to buy or sell securities or tokens. This podcast is for informational purposes only, and any views expressed by anyone on the show are solely our opinions, not financial advice. Mert, Dan and our guests may hold positions in the companies, funds, or projects discussed.
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