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LSD

What is LSD​

LSD stands for Liquid Staking Derivatives, which are tokens that allow you to earn staking rewards on your digital assets while keeping them "liquid" so you can still trade or use them in other applications.

How Liquid Staking Works​

  1. Deposit: You deposit ETH and receive cETH tokens in return. The exchange rate reflects the total principle and accumulated interest of deposited, staked ETH divided by the number of cETH shares in circulation.

  2. Hold and use: Your cETH tokens remain fully liquid. You can trade them, use them in other protocols, or hold them to accumulate rewards. Over time, each cETH becomes worth more ETH as staking rewards accumulate.

  3. Withdraw: When you're ready to exit, you have two options:

    a. Instant withdrawal through the withdraw pool

    b. Traditional unstaking through the standard process (takes more time but has no fees)